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Series Of Deals Thrusts Mexichem Into Spotlight

by Alexander H. Tullo
November 21, 2011 | A version of this story appeared in Volume 89, Issue 47

Braskem isn’t the only Latin American chemical firm to become a player on the world stage over the past decade. From 2003 through 2011, Mexichem has grown from $259 million to a forecasted nearly $4 billion in annual sales. At a Nov. 3 luncheon in New York City organized by the Chemical Marketing & Economics Group of the ACS New York Section, Mexichem’s new chairman, Juan Pablo del Valle Perochena, explained how the company expanded so quickly.

Eight years ago, he said, Mexichem was a local producer of chlorine and caustic soda, as well as a miner of fluorspar, the mineral used to make hydrofluoric acid and downstream fluorochemicals. Since then, the company has invested $2 billion on acquisitions and new plants.

The purchases have been focused in Mexichem’s two core businesses. “We are not buying airlines, and we are not buying things that are not related to chlorovinyls or fluor,” de Valle Perochena said.

The bulk of the purchases have been of Latin American makers of polyvinyl chloride and fabricated products such as pipe. Recently, Mexichem has ventured beyond Latin America. Earlier this year, it purchased the AlphaGary wire and cable compounding business from Rockwood Holdings for $300 million. Last year, it bought refrigerants maker Ineos Fluor.

And Mexichem isn’t finished. At the event, Perochena said that some 20 researchers are working on a next-generation hydrofluoroolefin refrigerant at the company’s facility in Runcorn, England. He also disclosed that Mexichem is interested in expanding into fluoroelastomers and fluoropolymers.

In chlorovinyls, the company formed a $556 million joint venture with state oil company Pemex to expand a vinyl chloride plant in Mexico. It has been purchasing vinyl chloride from Pemex. De Valle Perochena says a Mexichem goal is to back-integrate into ethylene as well.


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