LyondellBasell eyes plastic maker acquisition

Houston petrochemical company LyondellBasell said Thursday that it will buy Ohio plastics maker A. Schulman for $2.25 billion in cash to diversify its operations into specialty products during a period of rapid industry expansion.

LyondellBasell will purchase A. Schulman for $42 a share, nearly a 9 percent premium over its closing price Feb. 14, and assume the company's $835 million in outstanding debt. The companies expect to complete the deal during the second half of the year, pending shareholder and regulatory approvals.

It's a relatively small acquisition for Lyondell-Basell, which reported nearly $4.9 billion in profit and $34.5 billion in revenue last year. But it will expand the company's capacity to produce more specialized plastics products such as compound resins and additives for a range of consumer and industrial products.

The deal would roughly double the size of LyondellBasell's compounding segment, which turns plastic resins into materials used mainly in automobiles. A. Schulman, meanwhile, uses a wider range of plastics to make compounds, composites, powders and other materials for packaging, consumer goods, electronics and agriculture.

"It makes us a full-range compounding company," CEO Bob Patel said during a conference call. A. Schulman and LyondellBasell's compounding segment together produced $4.6... More...

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