Indorama buys Eastman assets; Europe's PET industry remains in flux

Polyethylene terephthalate (PET) supplier and processor Indorama Polymers Public Ltd. (Indorama; Bangkok, Thailand) has acquired the European PET production assets of Eastman Chemical Co. (Kingsport, TN) for 65 million euros. The acquisition includes a 200,000-tonnes/yr PET production facility in Rotterdam, the Netherlands, and the purchase of a 155,000-tonne/yr facility in Workington, England. The facilities will be integrated into Indorama subsidiary Indorama Polymers Europe, which last year started the largest PET supply plant in Europe, in Klaipeda, Lithuania. According to Indorama, European PET demand now exceeds supply, giving the firm reason to believe it can improve the profitability of the newly purchased plants.
In 2006 Indorama made a number of PET investments beyond Lithuania, expanding capacity at its North American facility, StarPet, to 225,000 tonne/yr of PET, and the same amount for amorphous PET (APET), which is typically used for sheet extrusion and then often thermoformed. Another site, in Decatur, AL, will open in late 2008 and add an additional 432,000-tonnes/yr capacity in North America, where the supplier says PET will be in short supply come 2009. It doubled capacity in Thailand to 180,000 tonnes/yr and will reach that amount of APET capacity in mid-2008. In Thailand, the firm since 1998 has also owned Petform: a preform, closure molding, and PET bottle blowmolder.
Once the Decatur plant is online, and including the recent Eastman purchase in Europe, Indorama Polymer’s global bottle-grade PET capacity will be about 1,450,000 tonnes/yr.
For Eastman, the sale continues its shedding of overseas PET production assets, which have been unprofitable or only marginally in the black. Earlier this month, it completed the previously announced sale of its PET production assets in Mexico and Argentina to Mexico’s Alfa.
Europe’s PET industry has been in flux for some months. Last month, Swiss supplier Equipolymer announced it would increase the capacity of its Ottana, Italy polyethylene terephthalate (PET) production site by 150,000 tonnes/yr to 485,000 tonnes. With that new capacity Equipolymer, a joint venture formed in 2004 between Dow Chemical and the Kuwait Petroleum Corp., would have become the largest PET supplier in Europe, until Indorama stepped in for the Eastman acquisition.
The current leading European supplier of PET, Spanish supplier La Seda de Barcelona, earlier this summer acquired the European PET bottle blowmolding and preform molding operations of Australian packaging group Amcor Ltd. for 425 million euros. La Seda will fall to third place there once Equipolymer completes its expansion and Indorama closes its deal with Eastman. La Seda and Indorama are part of a growing group of plastics suppliers that also process at least some of their own materials, bringing almost complete vertical integration to the market.—[email protected]

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