LyondellBasell unloads struggling European plants

Following a yearlong review of its struggling European olefin and polyolefin business, LyondellBasell Industries has decided to practically give away four European chemical facilities to Aequita, a private equity firm that specializes in industrial turnarounds.The deal, awaiting further discussions with employee groups, comprises LyondellBasell’s complexes in Berre, France, and Münchsmünster, Germany, which make ethylene, propylene, and polyethylene; the French facility makes polypropylene and butadiene as well. The transaction also includes polypropylene plants in Carrington, England, and Tarragona, Spain.LyondellBasell is contributing about $300 million in cash to the business, while Aequita will contribute about $11 million. LyondellBasell will get up to $115 million from the business’s earnings after 3 years. The company expects to record an overall loss of $700 million–$900 million from the sale.LyondellBasell CEO Peter Vanacker says the move will let the company focus on lower-cost facilities in the US and Middle East during this long period of overcapacity. “Through decisive portfolio management, we are enhancing profitability and building greater resilience to position ourselves to emerge from this downturn stronger and more resilient than before,” he said in a conference call with analysts on June 5.The company is retaining a footprint in Europe. LyondellBasell’s petrochemical complex in Cologne, Germany, where it is building a plastics recycling plant using its own catalytic pyrolysis technology, will be its core operation in the region. Its site in Brindisi, Italy, remains under review.The sites LyondellBasell is divesting were for the most part losing money over the past 5 years, Vanacker said on the