Solvay, the plastic and chemicals manufacturer from Belgium is seeking an exit from its European PVC business through the formation of a jount venture with INEOS. INEOS is a peer of Solvay in the business and the joint venture is merely preparatory for the eventual sale of the operations within four to six years.
Solvay and INEOS issued a joint statement saying they would be combining their chlorovinyl activity through an equal sharing venture creating the second largest PVC producer in the world in terms of capacity.
Solvay reiterated that it would be exiting the business within four to six years after the formation of the joint venture. An upward payment of Eur250 million would be made as well as a core profit multiple of 5.5 times.
According to Solvay's CEO Jean-Pierre Clamadieu, in a statement, "This transaction would substanially change our portfolio of activities and allow us to accelerate Solvay's transformation into a chemical group focused on growth and high-margin business."
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