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CHEMCHINA and SINOCHEM are planning to merge and reorganize in the late stage

China chemical and China Sinochem are planning to merge and reorganize in the late stage

May 10, 2017

[China paint information]

the long rumored merger of China National Chemical and Sinochem Group has recently been updated: according to CICC oil and gas research on May 9, 2017, the Financial Times quoted bankers as saying that China National Chemical and SINOCHEM plan to merge in 2018, and the combined group will form the world's largest chemical group with an annual revenue of $100billion

many industry analysts speculate that the strategic positioning, group structure, possible mergers and acquisitions of Sinochem Group in the future We only make some conjectures about the petrochemical sector from the industry research and the limited understanding of the two companies:

1. Oil and gas petrochemical sector

the oil and gas sector of CHEMCHINA is integrated with Sinochem Quanzhou refinery to form a petrochemical organic chemical sector

China National Chemical Corporation now has nine oil refining enterprises with crude oil processing capacity of about 25million tons, while Quanzhou refining and Chemical Co., Ltd. of Sinochem Group has a refining and chemical capacity of 12million tons in the first phase and a capacity of 15million tons in the later stage of engineering transformation and expansion

2. Polymer high-performance materials

there are many tire enterprises under China Chemical Industry: the original Italian Pirelli and domestic Aeolus tires; Sinochem Group has Sinochem International's world leading rubber additive enterprise Sinochem chemical, and its natural rubber business accounts for the top three in the world; The French Rhodia silicone business acquired by Sinochem Group, as well as the existing PBT, fluororubber, neoprene, etc., and the epoxy resin of Yangnong chemical, form a series of products such as rubber, engineering plastics, additives, etc

3. Spray free modified engineering plastics

3. Chemical fertilizer, seed industry and pesticide sector with Syngenta as the main body

CHEMCHINA has some agricultural related businesses such as chemical fertilizer. In the future, it may take Syngenta as the main body to integrate domestic Yangnong group, Jiangshan group, Sinochem fertilizer, Sinochem seed industry and SINOCHEM agrochemical to form nitrogen, phosphorus and potassium fertilizers, herbicides, pesticides, fungicides, plant growth agents And modern agricultural solution providers for the seed industry

4. The chemical equipment business segment

takes the acquired German plastic equipment manufacturer Klaus mafi as the main body, forming advanced chemical equipment business segments such as rubber and plastic equipment and chlor alkali equipment

5. Taking the acquired former French andisu company as the main body and forming a special chemical business sector dominated by animal nutrition products, Sinochem Group ranked 105th with a total revenue of $80.635 billion, CHEMCHINA ranked 265th with a total revenue of $41.813 billion, and Syngenta's revenue was $13.4 billion. The three companies merged, with a total of more than US $130billion (based on 2015), but it is estimated that during the restructuring process, some experimental data will be automatically printed out, with multiple business splits and new mergers and acquisitions

at present, Sinochem Group's A-share companies are Sinochem International, Yangnong chemical, Jiangshan Co., Ltd., Intel group, and Hong Kong stock company. "Luo Wen said that the companies are China Jinmao, Sinochem fertilizer, far east Hongxin, and Jinmao investment respectively

CHEMCHINA has 8 professional companies, 118 subordinate production and operation enterprises and 25 scientific research and design institutes. Many businesses and technologies are in a leading position in China and even the world. It has 12 A-share listed companies and 4 overseas enterprises

last Friday, Syngenta shareholders accepted the acquisition proposal of CHEMCHINA, and about 80.7% of the shares were purchased. According to the report, the purpose of the merger of CHEMCHINA and SINOCHEM abroad, including sage automotive interiors, BASF, Faurecia, Johnson Controls, Lear, Dow Chemical, DK leather and DuPont, is to ensure that CHEMCHINA has the financial strength to merge Syngenta. Jilin Petrochemical ABS unit has a total annual capacity of 580000 tons, a total of three units. Its ABS unit with an annual output of 180000 tons mainly produces 0215a; The ABS unit with an annual output of 200000 tons mainly produces GE150, etc; Another ABS unit with an annual output of 200000 tons mainly produces 0215asq, etc. Recently, the three units have maintained full capacity production

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