PVC industry consolidation in central and eastern Europe?
Within the past few days the CEO of Hungary's BorsodChem has restated his intention to sell or joint-venture out the company's 365,000 tonne/year PVC operation. Poland's PKN Orlen is also seeking a buyer for subsidiary Anwil, which has a 435,000 tonne/year PVC plant as well as a nitrogen fertilizer business.
I sniff an opportunity here for a strategic move into the region by a multinational or even a regional player seeking to increase market share here. The longer term outlook is bright for PVC in CEE as it serves the construction sector which should enjoy good rates of growth once again as the recovery takes hold.
According to ICIS news, Hungary's BorsodChem has guaranteed that its 365,000 tonne/year polyvinyl chloride (PVC) plant will not be closed even if the search for a buyer or joint-venture partner for the facility proves fruitless.
The PVC unit will remain an important part of BorsodChem's production chain because it recycles hydrochloric acid, a byproduct of the company's manufacturing of isocyanates in Kazincbarcika, northern Hungary, CEO Wolfgang Buchele said.
"BorsodChem never had, and also today does not have, an intention to close down PVC. BorsodChem does not necessarily have to own PVC by itself. However, PVC is in any case valuable due to the synergy with the isocyanate production," he added.
In June last year, BorsodChem widened its attempt at finding an investment solution for its PVC business by inviting not just potential buyers but possible joint-venture partners to take a look at the plant. Since February, BorsodChem has been owned by China's Wanhua Industrial Group.
Picture credit http://www.sxc.hu/photo/1311426
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