Solvay Sells Shares in Latin America

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Researched by Industrial Info Resources (Cordoba, Argentina)--Solvay (Buenos Aires, Argentina), which is owned by Solvay S.A. (ERB:SOLB) (Brusells, Belgium), decided to sell its Latin American shares. This decision was made following economic losses generated since 2009 by the company's two production sites in the region, as well as the growing production costs and the continuous interruption of the natural gas supply, which is a necessary fuel for these facilities.

These two production sites are located in two important petrochemical complexes, one of them in the Bahía Blanca Petrochemical industrial pole, in Buenos Aires, Argentina, and the other in Santo Andre, San Pablo, Brazil. Both sites are the only ones this company owns to supply the region, which will be affected by the sale.

Both plants had important expansion projects planned, including the construction of a new unit, but all have been suspended until the selling processes are complete. At present, authorities from the Argentinean office have decided to invest only on undertakings related to routine maintenance turnarounds in their units.

Solvay's Argentina branch produces more than 210,000 metric tons per year of polyvinyl chloride (PVC) and 163,000 metric tons per year of caustic soda. It had been scheduled to undergo a $1.5 million project to upgrade its flare system through this first quarter of the year, but the upgrade was then suspended. Brazilian Solvay already had suspended $25 million in expansion projects in the caustic soda unit, as well as its $140 million project for the construction of a new green ethylene unit to be implemented between 2012 and 2013.

Solvay authorities said that for the moment, the production and commercial activities will continue and that the future of all suspended projects depends on the company that buys the shares and on the agreement reached with Solvay.

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