A major new player in global engineering plastics was officially launched today following the purchase of GE Plastics by the Saudi Basic Industries Corp. (SABIC). The name for the new entity is SABIC Innovative Plastics, reflecting GE Plastics’ long-standing role in developing not only new plastics, such as polycarbonate, but whole new application categories, particularly in automotive. The only potential problem was the stiffening of credit markets, but SABIC has a solid credit foundation, reaffirmed by Fitch Ratings service two days ago. The official announcement contained no news or surprises. Brian Gladden, who had been general manager of the Lexan brand, takes over as CEO of the company.
SABIC Innovative Plastics employs 11,000 and is a leading manufacturer and compounder of polycarbonate, ABS, ASA, PPE, PC/ABS, PBT and PEI resins. A few issues had to be ironed out before the completion of the deal:
- GE Plastics acquired the entire equity of MCI and Nagase in their Japanese joint venture.
- GE Plastics also bought out the equity position of Bayer MaterialsScience in Exatec, which develops protective coatings for the polycarbonate automotive glazing market. BMS will continue to develop glazing applications independently.
The two moves, completed this month, are an early sign that SABIC will be an investor in the plastics business. SABIC has already purchased the assets of DSM’s and Huntsman’s petrochemicals businesses in Europe. The GE Plastics move represents a major move into the engineering plastics area. Previously, its assets had been heavily focused on volume plastics, which are generally sold more on price than engineering features.