23 April 2014 22:48 [Source: ICIS news]
HOUSTON (ICIS)--Dow Chemical's chlorine business has drawn interest from several strategic buyers, the company's CEO said on Wednesday.
Andrew Liveris described the number of potential buyers as being in the double digits.
He made his comments during an earnings conference call.
The business should be in the market in the third quarter, Liveris said.
The carve-out represents up to $5bn of the company's total revenue. It includes approximately 40 manufacturing facilities at 11 sites and almost 2,000 employees.
Dow would like to complete the deals in the early part of the 12- to 24-month timespan it gave when it announced the carve-out late in 2013.
Assets that are part of Dow’s carve-out include its chlor-alkali and chlor-vinyl facilities in Plaquemine, Louisiana, and Freeport, Texas. This includes the company's stake in the Dow Mitsui chlor-alkali joint venture in Freeport.
It also includes Dow’s global chlorinated organics plants in Freeport and Plaquemine as well as in Stade, Germany.
The epoxy resins assets include units at Freeport and Roberta, Georgia, in the US; Rheinmuenster, Baltringen and Stade in Germany; Pisticci, Italy; Gumi, South Korea; Zhangjiagang, China; and at Guaruja in Brazil.
Options to sell the group’s brine and select assets, which support operations in Freeport and Plaquemine and energy operations in Plaquemine, will also be explored.
The capacity being shut down will be replaced with supply from the new plants that are coming on line with the start-up of the Dow Mitsui joint venture in early 2014.
The epoxy resins and chlorinated organics businesses had received the bulk of Dow's chlorine production. In fact, Dow's chlorine needs will fall by 70% once one considers the carve-outs and the capacity reductions that the company has announced in the past 10 years.
Nonetheless, Dow will still need chlorine for its polyurethanes and agricultural-chemical businesses. These chlorine needs were among the reasons why the carve-out is so complex.
Dow will establish chlorine supply and purchase agreements similar to those it made with the 2010 sale of Styron, its styrenics business.
Dow sold Styron to Bain Capital for $1.63bn.
Styron is changing its name to Trinseo.
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