UPDATE 1-Mexichem says investment plans will 'transform' company
MEXICO CITY, March 21 (Reuters) - Mexican plastic pipe and chemical maker Mexichem said Thursday its investment and acquisition plans through 2014 will transform the industrial conglomerate, although 2013 sales will be similar to last year's.
The company has $1.2 billion ready to spend on acquisitions, a sum expected to generate $240 million in earnings before interest, tax and amortization (EBITA), Mexichem president Juan Pablo del Valle said at an event in Mexico City.
Del Valle said the company expects to announce in a couple of weeks an acquisition in the U.S. plastics sector. Without going into further detail, he added that Mexichem is also working on the purchase of another firm to boost production of fluorite, a mineral used in steelmaking and glass.
"These projects are going to transform Mexichem," he said.
Del Valle added that he expects 2013 sales and EBITA to be similar to 2012 figures.
Mexichem's sales last year totaled about $5 billion while EBITA reached $1 billion.
Mexichem also said its joint venture with state oil monopoly Pemex will begin in May.
Pemex approved the venture between the oil giant and Mexichem in January to produce vinyl chloride monomer, a chemical used to make plastic pipes, resins and paints.
Valle said the industrial conglomerate will invest $200 million in Pemex through 2014, which will help upgrade Pemex's Pajaritos petrochemical facilities in Coatzacoalcos, a city in the Gulf state of Veracruz.
"We will invest what we need to invest in order to rescue these assets and make them competitive," added del Valle.