10 April 2013 14:24 [Source: ICIS news]
LONDON (ICIS)--Arkema is to book a non-recurring charge of €125m ($164.5m) in its financial results for the first quarter of 2013, to account for its total exposure to troubled upstream vinyls production business KEM ONE SAS, which it divested last year, the France-based specialty chemicals company said on Wednesday.
KEM ONE - which was placed into receivership last month at the request of Gary Klesch, head of current owner Klesch Group - said on 9 April that it has secured financing from partners Arkema and French oil giant Total for a six-month observation period as part of its insolvency proceedings. Arkema said that its contribution to the company’s continuing operations for the period will be €68.7m.
The €125m figure represents Arkema’s estimated total exposure to KEM ONE SAS’s international operations, and includes certain guarantees, extended by Arkema to third parties and made available to KEM ONE during the observation period. Lyon Commercial Court has appointed an administrator to oversee the company’s operations for the period.
Lyon Commercial Court has appointed an administrator to oversee the company’s operations for the period.A spokesman for Arkema told ICIS that the financing would represent the whole of the company's involvement in KEM ONE SAS's observation period.
KEM ONE SAS is the upstream vinyls production unit of KEM ONE, which was acquired by Klesch from Arkema in July 2012.
The observation period for the business began on 27 March 2013.
(€1 = $0.76)
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