Dow Chemical yesterday said that it will sell its polypropylene (PP) business to Brazilian plastics and petrochemical giant Braskem for $323 million, as part of the chemical giant streamlining its plastics portfolio.
Under the deal, which is expected to close by the end of the third quarter 2011, Braskem will pay $323 million in cash plus assume $17 million debt.
The sale includes Dow's polypropylene manufacturing facilities at Schkopau and Wesseling in Germany, and Freeport and Seadrift in Texas. Also included are inventory, business know-how, certain product and process technology and customer contracts and lists.
Dow's polypropylene licensing and catalyst business and related catalyst facilities are excluded from the deal, said the Michigan-based chemical company.
Dow's PP business has total annual production capacity of 1,050 thousand tons, with the Schkopau and Wesseling facilities having annual capacity of 545,000 tons while the Freeport and Seadrift facilities have up to 505 thousand tons.
The acquisition will increase Braskem's PP regional capacity by 50 per cent.