Celanese Corp, based in Dallas, TX, announced that the company already reached an agreement with Daicel Corporation to sell 45% of its equity investment worth $1.575 billion in the Polyplastics JV. After the transaction completes, Daicel will wholly own Polyplastics. Lori Ryerkerk, Celanese Chairman and Chief Executive Officer said that the company has been growing their base business in engineered materials tremendously and inventing over the last 10 years. The company has advantages, an ability to boost the unique business model along with the flexible strategies in delivering sustainable growth that set it apart from others. The company is planned to use this opportunity to monetize historically passive investment and allocate significant capital within the company and aim for higher business growth. The joint venture partnership with Daicel for more than 50 years comes into conclusion that the company jointly brings innovative products and engineered materials to customers, especially in Asia, where the presence is considerably greater than before the joint partnerships. The agreement will be marked as the departure from a long-term relationship into a contemporary connection which will propel future growth.
Senior Vice President of Engineered Materials at Celanese, Tom Kelly said the business is positioned to a growth trajectory to a new product development aligned with the consumer demand and key geographies. The continuing investment in product expansion that has growing demand for instance the 5G, sustainable materials, advanced mobility and medical/pharmaceutical. The manufacturing capacity and advancing T&I capabilities in Asia is also one of the aims of Celanese expansion to meet demand in the growing region. The transaction is expected to be finalised in the second half of this fiscal year, as to be subject to necessary approvals for regulators and customary conditions in closing. In the meantime, Polyplastics will continue to operate under management structure and joint venture ownership until the finalising process is completed.
Celanese’s Board of Directors also has approved a $500 million increase to its existing share repurchase authorization, approximately 5% of the Company’s shares outstanding additional authorization. Around $1.063 billion is still remaining on the existing share repurchase authorization, which remains feasible in addition with another $500 million share repurchase authorization. The total authorization is at $1.563 billion, or an approximate percentages of 15% of the company’s shares outstanding.
