Indorama Absorbs Huntsman EO & PO Assets
Thailand’s Indorama Ventures (IVL), the world’s largest PET producer, has created a new business segment under the name Integrated Oxide to incorporate the integrated ethylene oxide and proplylene oxide (EO&PO) assets acquired from US chemical producer Huntsman.
The acquisition of the oxides and derivative businesses completed on Jan. 6 included a large flagship site on the US Gulf Coast (USGC) at Port Neches, as well as sites at Chocolate Bayou and Dayton in Texas. The two non-US sites are at Ankleshwar, India, and Botany, Australia.
Indorama said the $2 billion cash transaction, the largest in its history, is expected to add substantial synergies to its existing 450,000 t/y ethane/propane cracker and its 550,000 t/y EO/EG plant. The business will now be fully integrated from ethane to PET as well as in the high-margin EO and PO derivative segment.
The Thai group added that the Huntsman deal, funded solely through its internal cash flows and debt financing, reinforces its Integrated Oxides and Derivatives (IOD) segment’s continued development as envisioned in its strategy plan from 2019 and includes “much sought after” portfolios of value-added EODs and propylene oxide (PO) derivatives, each with a strong market position.
Apart from the portfolio, IVL said the acquisition adds strong R&D and technical capabilities including about 900 patents and other intellectual properties. The entry into Australia will further diversify the PET specialist’s geographic presence.
Another plus is an “unprecedented” entry into global niche markets and industries with a sustained growth rate of more than 5%. This includes herbicides and unsaturated polyester resins for coatings, particularly in marine use.
Indorama said it is committed to extracting further synergies and opportunities, such as supply chain and procurement consolidation as well as lowering corporate overheads and SG&A. These synergy benefits, it said, will further boost EBITDA contributions by $40 million up to 2021.
Unquantified additional capital spending planned for the high value-added surfactants business is foreseen to add incremental EBITDA of $60 million by 2022.
New Leadership for New Business
Alastair Port was appointed as president of Indorama’s new integrated Oxide, effective Jan. 3. He reports to Dilip Kumar Agarwal, CEO of the group’s Feedstock and PET businesses. Port joined Huntsman in 1988 and was previously global vice president of manufacturing and upstream business at Huntsman.
The new corporate unit draws its leadership team from all of the newly integrated activities. Steve Thallemer, the new chief finance officer, was formerly with Indorama Ventures Oxide and Glycols (IVOG). Leo Guglielmi will serve as vice president and legal counsel and Paul Fusco has will be director of Human Resources.
Joel Saltzman, currently with IVOG, has been named senior executive vice president. Two John Smiths have joined the team. John O. Smith, also currently with IVOG, will serve as vice president, procurement and upstream. John Q. Smyth has been appointed vice president, global downstream derivatives.
Additional positions are Carol Ottaway as vice president, supply chain, logistics and IVL transition, Chad Anderson as vice president manufacturing, and Kim Knotts as director EHSQ .