The Hindu : Business : Shell, BASF to sell plastics joint venture

Online edition of India's National Newspaper
Friday, May 06, 2005

Business

Business

Shell, BASF to sell plastics joint venture

Access Industries and The Chatterjee Group-led consortium in euro 4.4 billion ($5.7 billion) deal

LONDON: The Royal Dutch/Shell Group of Cos. and the German-based BASF said on Thursday that they had agreed to sell their Basell NV plastics joint venture for euro 4.4 billion ($5.7 billion) to a consortium led by the New York-based Access Industries and the Chatterjee Group.

Shell and BASF said in a joint statement that the deal is subject to approval by antitrust authorities and is expected to be closed in the second half of 2005.

The two companies formed Basell as an independent venture in 2000 to consolidate their polyolefins businesses across the world and announced plans to review its options in 2004.

Purnendu Chatterjee, Chairman of the Chatterjee Group, said the consortium was impressed with Basell's broad customer portfolio and premium market position.

"We look forward to consolidating Basell's global leadership position through enhanced commitments in technology,'' he said.

The Netherlands-based Basell is the world's largest producer of polypropylene, a material used in making bottles, food and beverage packaging, grocery bags and toys, among other things. The company's products also are finding a growing market in the auto-parts industry.

It has manufacturing operations on five continents and sells to more than 4,000 customers in more than 120 countries.

``Basell's recent strong performance has shown that it was the right decision to form the joint venture,'' said John Feldmann, member of the Board of Executive Directors of BASF Aktiengesellschaft and Chairman of Basell's supervisory board. ``The strategic divestment will no create additional value for the BASF group as part of the company's ongoing portfolio management.''

Fran Keeth, Executive Vice President of Shell Chemicals, said that the sale will allow Shell to focus on its strategy of ``leveraging the oil products and chemical activities, to strengthen our core portfolio in Europe and Norther America, and to grow in Asia and the Middle East.'' — AP

TCG's role

Indrani Dutta reports from Kolkata:

The role that the Kolkata-based Haldia Petrochemical Ltd. (HPL) will play in Basell NV buyout is still undecided, HPL board level sources said.

Purnendu Chatterjee of The Chatterjee Group, who, according to agency reports, has acquired along with a consortium, the world's largest petrochemical company, has already made presentations on the likely benefits for HPL to West Bengal Government officials with whom he spent nearly two hours on Wednesday.

The State government, through its apex industry promotion agency, is the largest shareholder in the three-way joint venture HPL in which the Tatas also have an equity stake. The New York-based Mr. Chatterjee is the Deputy Chairman of HPL, and the deal, estimated at over $5 billion, is being billed as the largest one involving an Indian.

Sources said that Bassel, an equal joint venture of the Royal Dutch/Shell group and BASF, Germany, has over 23 plants all over the globe and owns 8,800 patents. It has on its rolls at least two Nobel laureates. "Nearly 20 per cent of Bassel's turnover comes from catalysts for which they hold licenses, two of HPL's units located at its petrochemical plant in Haldia in West Bengal, use BASF technologies," sources said.

HPL's lenders, led by the IDBI, were also being briefed about Bassel. Sources said that Mr. Chatterjee was in Mumbai as his lawyers worked overtime in London to hammer out a deal with their counterparts in Bassel NV. The Rs. 8,000-crore turnover HPL, having signed a debt recast deal last year, closed 2004-05 with its second net profit and is slated to go public later this year.

Printer friendly page
Send this article to Friends by E-Mail

Business

News Update

Stories in this Section