Mubadala Buys into Russia’s Sibur

10.12.2021 - Abu-Dhabi sovereign wealth fund Mubadala Investment Co. has acquired a 1.9% stake in Sibur, Russia’s largest integrated petrochemicals producer. Terms were agreed prior to Sibur’s merger with compatriot petrochemical producer TAIF, which Mubadala said is “bound to further the company’s position in the polyolefins and rubbers markets, contribute to the pipeline of growth capex projects and unlock additional operational synergies.”

Financial details of the transaction were not disclosed.

Mubadala and Sibur have had a long-standing partnership since 2015 and now we are excited to become shareholders in the company,” said Faris Sohail Al Mazrui, head of Mubadala’s Russia and CIS investment program. “Sibur’s merger with TAIF creates an even better-positioned player in the market that can capitalize on synergies and development opportunities.” In 2015, Mubadala invested in Sibur’s transshipment terminal in Ust-Luga.

Earlier this month, and following the merger with TAIF’s assets, Sibur announced it would divide the plastics, elastomers and organic synthesis division into two standalone business units. The plastics and organic synthesis division will consolidate assets with a total capacity of about 3 million t/y. Sibur said this division’s further expansion will be driven by the development of medium-tonnage chemicals, which enjoy strong demand in the Russian market.

Sibur also has plans to use this business to expand production of feedstock for high-margin, specialty chemicals, which it said have an “insignificant presence in the domestic market” currently.

The synthetic rubbers division will develop new grades with “unique” properties, as well as expand its footprint across segments and geographies. Sibur expects to ramp up the efficiency of its rubber business by increasing the availability of feedstock, predominantly butadiene, and develop production of the most popular butadiene-based rubbers going forward.

Author: Elaine Burridge, Freelance Journalist