Continuing its quest to become more of a specialty polymer company, Trinseo says it will launch a process early next year to sell its polystyrene business, including its 50% interest in Americas Styrenics, a joint venture with Chevron Phillips Chemical.
Trinseo has been aggressively reshuffling its portfolio recently and is beginning to look like a quite different company from what it started as in 2010: Dow’s former styrenic polymer business, then called Styron.
In May, Trinseo completed the $1.4 billion acquisition of Arkema’s polymethyl methacrylate (PMMA) resin business, which it hopes will pair well with its businesses in high-end styrenics such as acrylonitrile-butadiene-styrene and styrene-acrylonitrile resins. In September, Trinseo bought Aristech Acrylics, which turns PMMA into acrylic sheets for products like bathtubs and countertops, for $450 million.
Trinseo is also in the process of selling its synthetic rubber business, which operates a facility in Schkopau, Germany, to Polish competitor Synthos. It expects to complete the $450 million transaction in December.
The businesses Trinseo is now putting up for sale include its polystyrene unit, which supplies the polymer in Europe and Asia, and its European styrene operations. Together, these units generated about $1.1 billion in sales in the first nine months of 2021, about 30% of Trinseo’s total sales. Americas Styrenics, an integrated polystyrene maker, had nine-month sales of $1.4 billion.
“With the planned separation of our styrenics assets, which we expect will begin in 2022, we will have transformed our portfolio to what should result in a much less cyclical, higher margin, and . . . higher free cash flow business,” Trinseo CEO Frank Bozich told stock analysts in a Nov. 8 conference call.
The transformation, Bozich added, should also shrink Trinseo’s environmental footprint. “Companies with low carbon and energy intensity will be advantaged in their ability to allocate capital toward growth and shareholder value because they will be less burdened by regulations and the capital spending needed to address the inevitable energy transition,” he said.
Trinseo is the latest chemical company to put a major polymer business on the market. Earlier this month, DuPont said it was seeking a buyer for its engineering polymer business, which generates $4.2 billion in annual sales. And in September, DSM announced it was looking to divest its materials business, a polymer maker that has $1.9 billion in annual sales.