Reliance Industries has agreed to buy BP Plc's Malaysian petrochemical plant for USD 230 million, the British energy firm said.
New Delhi: Reliance Global Holdings will acquire BP Plc's Malaysian petrochemical plant for USD 230 million, the British energy firm said.
BP said it has "agreed to sell all its interests in purified terephthalic acid (PTA) production in Malaysia to Reliance Global Holdings Pte Ltd, Singapore (an associate firm of Reliance Ports and Terminals Ltd)".
Reliance Ports and Terminals Ltd is a company owned by billionaire Mukesh Ambani.
Reliance Global Holdings will take over BP's 100 per cent equity in BP Chemicals (Malaysia) Sdn Bhd (BPCM), located at Kuantan on the east coast of Malaysia.
The all-cash deal is planned to be completed in 2012, BP said in a statement.
The PTA plant in Kuantan, Malaysia is based on BP's proprietary PTA technology whereas Reliance Industries' PTA plants in India are based on Invista's Technology.
The acquisition through Reliance Global Holdings Pte Ltd would ensure that these two technologies are separately protected.
James Yim, Head of BP's aromatics business in Asia, said, "This is an efficient plant with a good market position in the region. RECRON Malaysia, part of the Reliance Group, is already our largest customer in Malaysia and RIL is a significant feedstock supplier at Kuantan, so Reliance is a natural owner of this plant".
Nick Elmslie, Chief Executive of BP Petrochemicals said, "BP has a major, global PTA business, with around one fifth of global PTA production capacity and a track record of leading technology.
"We will continue to concentrate our PTA strategy on deploying new technologies into high growth markets like China where we are in the middle of a considerable expansion programme, and in OECD markets where our technology gives us an advantage and high utilisation rates".
All current staff of BPCM are expected to transfer to the new owners under equivalent terms and conditions.
BP said its acetic acid manufacturing and marketing business in Malaysia is unaffected by this sale.
BPCM's PTA plant, commissioned in 1996, has nameplate production capacity of 6,10,000 tonnes per year.
BP's current net global PTA capacity is 7.5 million tonnes per year from eight sites in the US, Belgium, China, Indonesia, Malaysia and Taiwan. The largest is at Zhuhai, China with capacity of 1.5 million tonnes.