EU Approves Ineos-Solvay JV Inovyn
The European Commission has given its final approval to the merger of the Ineos and Solvay vinyls activities into a 50:50 joint venture called Inovyn.
With headquarters in London, the new plastics industry player will have pro forma sales exceeding €3 billion and 14 sites in eight European countries including Belgium, France, Germany, Italy, Norway, Spain, Sweden and the UK.
After giving the deal its initial blessing, with strings, last year the EU regulatory agency signaled its final approval on June 8 when it accepted the divestment of certain overlapping businesses to the private industrial holding ICIG based in Luxembourg, as agreed by the companies in March of this year.
Solvay plans to exit the jv after three years and pocket cash proceeds targeted at €250 million. The proceeds will be adjusted based on the joint venture's average REBITDA performance over the three years but will not be less than €75 million.
"Thanks to this agreement we now have a unique opportunity to create a world-class competitive player with high-quality assets and substantial synergies, better able to withstand the challenging environment in Europe," said Jean-Pierre Clamadieu, CEO of Solvay, who called the deal “another key step in the transformation of Solvay's business profile."
With the deal, ICIG will pick up facilities currently owned by Ineos in Belgium, France, Germany, the Netherlands and the UK with capacity to produce S-PVC, sodium hypochlorite (bleach), potassium hydroxide (KOH) and other related products.
Specifically, the assets include the S-PVC plants at Mazingarbe, France, Wilhelmshaven, Germany, and Beek Geleen in the Netherlands, along with the VCM plant at Wilhelmshaven.
Additionally, ICIG will take over the membrane electrolysis cellroom, the EDC/VCM plant and related production assets, including sodium hypochlorite productions, at Tessenderlo Belgium, and the chlorine cell room and the EDC plant located at Ineos’ Runcorn, UK, site.
The membrane chlorine plant at Runcorn will become part of a 50:50 joint venture between Inovyn and ICIG.
Following the asset purchases, ICIG said it will have aggregated sales exceeding €2 billion and around 6,000 employees in Europe and the US and will be a leading European player both in S-PVC and the potassium hydroxide (KOH) business.
The newly acquired activities will become part of a new Chlorovinyls platform trading under the name Vynova Group. This will complement ICIG’s €670 million Fine Chemicals and Custom Manufacturing platform WeylChem Group, its €330 million Pharmaceuticals platform CordenPharma Group and the ICIG Enterprises businesses worth €110 million in annual sales from CarboTech, Enka and Rütgers Organics.