Arkema Wins PVC Case

An arbitration court has ordered the Swiss industrial products firm Klesch Group to pay Arkema $78 million and court costs in a dispute over the 2012 sale of Arkema’s vinyl products business. Arkema paid Klesch $135 million to take over the ailing business, which had annual sales of more than $1 billion. Klesch subsequently named it Kem One. By March 2013, however, Kem One had filed for the European equivalent of bankruptcy as slow demand hobbled the European vinyls industry. At the same time, Klesch revealed that it was seeking an additional $400 million from Arkema for allegedly misrepresenting Kem One’s finances. Arkema balked and blamed Klesch’s problems on its decision to separate Kem One’s polyvinyl chloride (PVC) business from a downstream vinyl products business. The International Chamber of Commerce’s International Court of Arbitration decision brings to a close Klesch’s claim against Arkema. Kem One itself emerged from bankruptcy court supervision last year when investors OpenGate Capital and Alain de Krassny bought Kem One for $14 million.