New player on PVC market
The finalized terms of the Joint Venture agreement remain materially unchanged from those announced in June last year. Solvay received upon closing an upfront cash payment of €150 million - subject to customary adjustments such as actual working capital levels. In addition to contributing their entire European chlorovinyl business Solvay has transferred liabilities estimated at €260 million into the Joint Venture. In three years' time, Solvay will exit Inovyn and receive an additional, performance-based payment targeted to be €280 million, with a minimum of €95 million. Thereafter, Inoes will be the sole owner of the business.
Also effective July 1st, Solvay is buying BASF's 25% stake in its PVC Joint Venture SolVin. Financial details are not disclosed. In addition, Solvay and Inovyn have agreed to continue supplying basic chemicals to the BASF site in Antwerp.
Headquartered in London, Inovyn has pro-forma sales of more than €3 billion, with 4,300 employees and assets across 18 sites in Belgium, France, Germany, Italy, Norway, Spain, Sweden and the UK. Governance of the Joint Venture is equally split between the partners.
"Solvay's transformation has reached a key milestone with the creation of Inovyn and we will continue to focus on increasing its growth, returns and resilience," said Jean-Pierre Clamadieu, CEO of Solvay. "I want to thank all the teams involved for their commitment in making this happen and I wish the very best to all the employees who begin a new adventure with Inovyn and will ensure its success."
"The Inovyn Joint Venture combines two businesses with a strong heritage in the chlorovinyls industry, creating a company fit to thrive in an ever changing business environment," said Jim Ratcliffe, Chairman of Ineos. "This is now truly a world scale business, well placed to respond rapidly to customer needs in a challenging, competitive market."