BP Amoco shuffles styrenics as shareholders approve merger
15 Jan 2000
The closure of BP Amoco's Baglan Bay styrene plant is the price the company has chosen to pay for achieving dominance in the European styrenics market. BP Amoco has chosen to source its styrene from a new styrene monomer/polyethylene oxide (SM/PO) plant in Moerdijk, the Netherlands - part of its acquisition of Styrenix Kunststoffe from Huls last year. And the merger momentum shows no signs of slowing, with BP Amoco shareholders approving the company's proposed merger with Atlantic Richfield (ARCO).
The Baglan Bay unit closes this month, as the SM/PO plant at Moerdijk starts up. Owned and run by Shell, this plant was the subject of a 1997 supply agreement with Huls, which BP Amoco is now honouring. Also to close are three expandable polystyrene units at Wingles, France, superseded by a new unit earlier this year; and an older polystyrene train, again at Wingles, which has been replaced by an 85,000tonne line. The closures and new capacity are set to cut costs by 30 per cent and double productivity by the end of next year, claims BP Amoco.
Meanwhile, BP Amoco has claimed `overwhelming support' for its proposed merger with ARCO. Shareholders at an Extraordinary General Meeting in London threw the weight of almost two-thirds of the shares behind the merger. `Our discussions with various regulatory authorities are moving ahead, and our integration plan is ready to be implemented,' says BP Amoco chief executive John Browne. With ARCO's shareholders also supporting the proposals at a similar EGM, the deal is on course for completion before the end of the year.
