LyondellBasell, one of the world's largest plastics, chemical and refining companies, today announced that it has entered into a definitive agreement to acquire the polypropylene (PP) compounding assets of Zylog Plastalloys (Zylog) of India.
Upon completion of the acquisition, LyondellBasell will double its automotive customer base in India and become the third largest producer of PP compounds in the country with an annual capacity of 44,000 metric tons (97 million pounds).
Earlier this year, LyondellBasell acquired SJS Plastiblends, a manufacturer of PP compounds located in Aurangabad, Maharashtra, India. The Zylog acquisition includes manufacturing sites in Sinnar, Maharashtra, and in Chennai, Tamil Nadu.
"We are very optimistic about India's economic growth and rapidly expanding automotive market," said Bhavesh (Bob) Patel, CEO and chairman of the management board of LyondellBasell.
"The acquisition of SJS and Zylog are part of our plan to strategically expand our footprint where it makes sense from an economic and strategic perspective. With these investments, LyondellBasell will be a leading producer of PP compounds in all major automotive growth regions of the world," he added.
LyondellBasell is the world's largest producer of PP compounds with an annual capacity of 1.2 million metric tons (2.6 billion pounds). These compounds are used to manufacture automotive parts, home appliances and other products. LyondellBasell has supplied the Indian market through imports and tolling arrangements since 2009.
India represents the fourth largest growth market for automobiles globally with 3 million new vehicles produced each year. According to IHS Inc., India's automotive market is expected to continue growing by 6 to 8 percent annually through 2021. Additionally, the World Bank has predicted India's GDP to grow at a rate of 8 percent by 2017.
The transaction is expected to close in early 2016. Until the transaction is complete, Zylog will conduct business as usual and continue to provide the same level of support, service and high quality products to its customers.
