The world’s premier manufacturer of petrochemicals, plastics, and building products, Westlake Chemical has confirmed to have entered into a definitive agreement to acquire the global epoxy business of the USA-based Hexion Corporation for USD 1.2 billion. The estimated time of completion of the transaction is during the first half of 2022.
Hexion’s epoxy business, with a portfolio of base epoxy resins, epoxy speciality resins and intermediate product line, is a pioneer solution for coatings and composites application and is accountable for the gross sale valuing to USD 1.5 billion in the last 12 months ended on September 12, 2021. The acquisition, extending Westlake’s hold over 1300 associates, five research and development labs located in the US, Europe, and Asia, as well as eight manufacturing facilities dedicated to epoxy-based coatings and composite products, will mark the company’s expansion in epoxy resin downstream products line that serve a score of end-user industries like non-residential construction, electronics, automotive, aerospace, wind energy etc.
Epoxy resin is a category of the prepolymer, and polymer characterized by the presence of epoxy groups capable of exhibiting strong adhesive qualities. The year 2020 witnessed a global epoxy resin demand of 5 million tonnes which is expected to further rise in the coming 5 years at a CAGR of over 4%.
As per ChemAnalyst, the acquisition of Hexion’s epoxy business by Westlake reflects Westlake’s focus on capitalizing on the fast-pacing epoxy resin demand globally, especially in the automobile and renewable energy sectors. The newly acquired facilities in synergy with Westlake’s existing supply-chain network and product service expertise will aid in strengthening the company’s brand and competitiveness in the international market. The addition of a new customer base will support the rise in the company’s annual revenue.