Ineos Group Expands in Europe and Asia

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Researched by Industrial Info Resources (Sugar Land, Texas)--In February, Ineos Group companies continued to march forward with acquisitions and expansion plans to grow the company. Ineos is now the No. 3 chemical company in the world with 80 manufacturing facilities in 20 countries. At the beginning of the month, the European Commission cleared the purchase of the Hydro Polymers businesses in Norway, Sweden and the United Kingdom from Norsk Hydro (OTC:NHYDY) (Oslo, Norway).

The deal also covers the balance of 50% of the Noretyl ethylene cracker at Rafnes. Ineos Group acquired the initial 50% from Borealis in 2007. The chlor-alkali, PVC and compounds businesses in the deal have excellent synergies with Ineos' existing portfolio and will be integrated into the company's ChlorVinyls and Ineos's Films & Compounds divisions. The company now becomes the chlor-vinyls market leader in Europe.

In another deal, which will be completed by the end of March, Ineos Enterprises will acquire the full shareholding in Ineos Asiatic Chemical Company (IACC) in Bangpoo, Thailand. Ineos will take over the 40% shareholding of the local partner EACT to become the sole owner of IACC. The Thai company manufactures the proprietary Cereclor chlorinated paraffins and other blended products. Ineos is now working on a project to debottleneck the chlorinated paraffin plant to increase production capacity. IACC turned over about $13 million in 2007.

In the last week of February, Ineos Polyolefins announced that it will invest in random co-polymer technology on its liquid pool polypropylene (PP) units at Grangemouth, Scotland. Ethylene supply from the company's crackers will be linked to the PP unit to produce random co-polymer grades with a wide range of melt flow rates starting in the third quarter of 2008. These products will be marketed to the blow molding, packaging and medical sectors.

De-bottlenecking of the 50,000-ton-per-annum (TPA) liquid pool polypropylene unit at Grangemouth raised capacity in this unit to 285,000 TPA in early 2007. The company now intends to introduce swing capability on its 310,000 TPA LLDPE plant to produce HDPE grades. Rotomolding grades have recently been developed at the site, and ICO Polymers has been appointed as an exclusive partner to distribute Ineos's range of advanced hexane co-monomer rotomolding polymers. These investments will create a robust production platform throughput Europe and support the company's leading market position.

Also in the last week of February, the Ineos group received clearance from the EU competition authorities for the acquisition of BP's (NYSE:BP) (London) vinyl acetate monomer and ethyl acetate businesses. The deal covers 500,000 TPA of production capacity at Saltend near Hull in northeast England and the Teeside to Saltend ethylene pipeline. The deal broadens the company's portfolio of oxygenated solvents and also allows for the optimization of links between the Hull and Grangemouth manufacturing sites.

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