Petrochemical sale

BP is to sell Innovene, its olefins, derivatives and refining group, to UK-based Ineos. The $9 billion cash sale, subject to regulatory approvals, includes all Innovene’s manufacturing sites, markets and technologies.

BP first announced the intention of separating its olefins and derivatives business from its petrochemicals portfolio in April 2004 with an initial public offering (IPO) as one, possible, disposal option. In the interim, it received a number of approaches from companies considering a trade sale leading to this decision instead of the IPO.

Lord Browne, BP Group Chief Executive of BP, said that the decision to sell Innovene in its entirety removed any uncertainty around market conditions at the time of an IPO, as well as would-be investors’ concerns about BP’s remaining stake and future intentions.

Innovene is a 100% BP-owned group created in April 2005. It has 8,000 staff, manufacturing facilities in seven countries in North America and Europe, $18 billion revenues in 2004, 18 million tonnes of annual petrochemicals capacity and 412,000 barrels per day of crude oil refining capacity.

The sale is expected to be concluded early in 2006.