By Cameron Chai
Arkema has submitted its proposal to the Central Works Council for the divesture of its Vinyl Products business, as part of its strategy to grow the specialty chemicals operations within its Performance Products and Industrial Chemicals businesses.
As per the plan, Arkema will sell its Vinyl Products business with a healthy balance sheet to the Klesch Group, a company involving in commodity-related industrial operations, so as to improve the future and long-term development of the business. The creation of the new entity will include a balanced portfolio of upstream activities such as PVC, caustic soda and chlorine and downstream activities such as compounds and profiles.
The divesture will not involve the restructuring of production facilities. According to the proposal, all assets directly associated with the chlorine and derivatives operations in France and all downstream operations such as profiles, pipes and compounds, across the world will be divested. However, the facility located in Jarrie will not be divested to the new entity. The project will concern the Balan EVA activity but won’t concern the Saint-Auban plant.
Around 1,780 workers based in France and 850 workers outside France will be relocated to the new entity’s headquarters in Lyon, France. The divestment will allow Arkema to direct its investments and resources for the development of its Performance Products and Industrial Chemicals businesses. The resulting Arkema entity will have improved presence by region, enhanced profitability and decreased cyclicality, and can streamline its growth strategy to become a major player in specialty chemicals.