M&As: Ineos acquires LyondellBasell’s EO/derivatives biz for US$700 mn; Solvay’s Syensqo spin-off starts trading

Chemical firm Ineos has reached an agreement to acquire LyondellBasell's ethylene oxide (EO) and derivatives business, including the Bayport Underwood site in Texas, US, for US$700 million, the companies.

The deal includes a 420,000 tonne/year EO plant, a 375,000 tonne/year ethylene glycols (EG) plant and a 165,000 tonne/year glycol ethers plant, together with associated third-party business at the Bayport Underwood site.

All current LyondellBasell employees at the site and some who work offsite will transfer to Ineos on completion of the transaction, which is targeted for the second quarter of 2024.

Ineos is a leading producer in Europe and the acquisition expands its EO and derivatives business into the US, which is the world’s largest market, said Tobias Hannemann, CEO of Ineos Oxide.

The acquisition would also complement INEOS’ existing ethanolamines production facility at Plaquemine, Louisiana, he said.

The Bayport Underwood site has free land to develop Ineos’ third-party business supporting customers to co-locate and integrate into the existing EO and derivatives platform, Ineos added.

For LyondellBasell, the sale of the business is “evidence of our disciplined focus on value creation through the execution of a key pillar of our strategy – growing and upgrading our core,” said CEO Peter Vanacker.

Ethylene oxide plays an essential role in the day-to-day life of millions of people. It is a key raw material used in large-scale chemical production around the world. It is necessary for the production of pharmaceuticals, cosmetics, semiconductors, polyester, food packaging, construction materials, antifreeze, brake fluids, solvents, paints, soap and detergents.

The first site acquired by Ineos in 1998 was the ethylene oxide facility at Zwijndrecht Belgium. As a key raw material, this ethylene oxide facility became the foundation from which Ineos has grown its chemicals business.

In other news, Belgian chemical firm Solvay says it has successfully completed the spin-off of its Specialty activities to Syensqo, a pivotal moment in its rich history. This move marks a significant strategic shift for the group, positioning it as a frontrunner in essential chemicals on a global scale. It prepares Solvay to enter a new stage of sustainable growth, sharpening its focus on core business areas and reaffirming its dedication to market leadership, decarbonisation, and social responsibility.

With over 9,000 employees spanning 40 countries, Solvay is committed to offering sustainable products that meet society’s fundamental needs. These include purifying air and water, preserving food supplies, safeguarding health and well-being, creating eco-friendly clothing, enhancing automotive tire sustainability, and contributing to the thermal insulation, cleanliness and protection of homes.

Built on strong foundations, the group has consistently propelled industry progress through ongoing process innovation. With a portfolio encompassing key mono technologies such as soda ash, bicarbonate, silica, hydrogen peroxide, fluorine and rare earths, phenol, and solvents, Solvay serves as a vital and reliable supplier across global markets.

Pierre Gurdjian, Chairman of the Solvay Board conveyed enthusiasm about the completion of the spin-off, stating, "I'm excited about the successful spin-off, a strategic move that underscores our commitment to long-term value. This decision reflects our dedication to creating sustained value for stakeholders and ensuring Solvay's ongoing success. Collaborating with experienced and highly qualified directors, we're positioned to closely work with the executive leadership team, establishing Solvay as a leader in essential chemicals. The prevailing megatrends present compelling opportunities for enhancing value. Leveraging our leadership and insight, we will confidently guide Solvay into the future.”

Philippe Kehren, Solvay CEO, added "At Solvay, our mission is to harness the power of chemistry to create sustainable products for the world's most pressing challenges. Our commitment involves introducing process innovations and sustainable products, all while minimizing our environmental footprint. With the simplification driven by the separation, Solvay is poised to reinforce its track record of achieving robust top-quartile industry margins, generating cash, and delivering attractive returns. Our aim is to create enduring value for employees, communities, customers, and shareholders through our integrated approach.”

Emphasizing sustainability, Solvay's roadmap underscores the group’s commitment to a fair transition and environmental responsibility, with a proactive aim to achieve carbon neutrality by 2050. In its transition to cleaner energy, Solvay is eliminating coal usage by 2030 wherever renewable alternatives exist, with a notable goal of achieving coal-free energy at 5 of its 7 soda ash plants by 2025. Beyond reducing its own emissions, Solvay is committed to a 20% reduction in emissions along the value chain by 2030.

Solvay adds it has set ambitious targets, including zero accidents, gender balance in management roles, and a living wage for 100% of its workforce by 2026, aligned with the UN Global Compact Forward Faster initiative.

The completion of the partial demerger was effective on December 9, 2023. Solvay and Syensqo started trading as separate entities on Euronext Brussels and Paris under their respective ticker symbols on December 11, 2023.

(PRA)

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