Brazilian Authority Rejects Braskem's Acquisition of Solvay Indupa
Solvay S.A., Brussels, Belgium, has taken note of the Brazilian competition authority's (CADE) decision to reject the intended acquisition of Solvay's 70.59 percent majority stake in Solvay Indupa, Buenos Aires, Argentina, by Brazilian chemical producer Braskem S.A.. The decision was taken during a public hearing held on Wednesday.
While Solvay is awaiting details of the decision, it confirms that its strategic direction remains unaffected. Solvay will, as soon as possible, examine alternative options to sell Solvay Indupa which is South America's second-largest PVC producer and fourth-largest caustic soda producer.
Based on the experience acquired in its activities in the PVC market over the last 35 years, Braskem disagrees with CADE's decision, which it considers prejudicial to Brazilian manufacturers. With the objective of favorably concluding the transaction, Braskem presented solutions it deemed effective for resolving CADE's concerns and regrets that they were not accepted.
According to Braskem, this decision weakens Brazil's petrochemical industry by affecting its capacity to capture of efficiencies of scale that would enable it to compete more effectively in international markets, particularly given the current scenario of the global PVC industry marked by lower profitability and a clear global trend of consolidation of assets.
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