By Cesar Bianconi
SAO PAULO Dec 17 Braskem SA, Latin
America's largest petrochemical company, reached a deal on
Tuesday to buy plastic maker Solvay Indupa, largely by taking on
debts of the Argentine-Brazilian unit of Belgium's Solvay SA
, a unit valued at $290 million.
A securities filing confirmed a Reuters report earlier on
Tuesday that the Brazilian company would acquire the company
with plants making PVC resins and caustic soda in Brazil's Sao
Paulo state and Argentina's Buenos Aires province.
The deal, which represents Braskem's first move into
production in Argentina, comes as the southern neighbor is
courting foreign companies to develop the Vaca Muerta field, one
of the biggest shale reserves in the western hemisphere.
"The acquisition ... reinforces a strategy of combining
investment with new alternatives for access to competitive raw
materials," Braskem said in the filing.
The company is building a $4.5 billion plant in Mexico and
studying options for investment in the United States as it
chases access to cheap natural gas rather than the more
expensive naptha fuel stock it uses at most existing plants.
Chief Executive Carlos Fadigas said Braskem would acquire
Solvay Indupa mainly through assuming its debts, along with a
small cash disbursement.
In the contract signed on Tuesday, Braskem agreed to buy
70.59 percent of the company from its controlling owner. Braskem
will also offer to buy up the 29.41 percent of the company
floated on the Buenos Aires stock exchange.
The deal may also advance Braskem's mission to become "the
global leader in sustainable chemistry" by the end of the
decade. In 2007, Solvay Indupa began studying how to produce PVC
from sugarcane-based ethanol in a process similar to Braskem's
so-called "green" polyethylene production.