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Presentation sunoco acquisition


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Presentation sunoco acquisition

  1. 1. Acquisition of Sunoco ChemicalsBernardo Gradin Carlos Fadigas
  2. 2. Forward-looking StatementsThis presentation contains forward-looking statements. These statements do notrepresent historical fact, but rather reflect the beliefs and expectations ofBraskem’s management. The words “anticipate”, “wish”, “expect”, “estimate”,“intend”, “forecast”, “plan”, “predict”, “project”, “target” and similar wordsare intended to identify these statements. Although Braskem believes that theexpectations and assumptions reflected by these forward-looking statements arereasonable and based on information currently available to management,Braskem cannot guarantee future results or events.The forward-looking statements in this presentation are valid only on the datethey are made (September 30, 2009) and the Company does not assume anyobligation to update them in light of new information or future developmentsBraskem is not responsible for any transaction or investment decision takenbased on the information in this presentation. 2
  3. 3. Transaction Overview • On February 1, 2010 Braskem acquired 100% of the shares of Sunoco Chemicals1, made up of the Sunoco Polypropylene Business – 950 kty of PP. • Braskem America, a wholly owned subsidiary of Braskem, S.A. acquired the business for $350 million in cash, to be paid within 60 days. • Sunoco Chemicals: – 4th largest supplier of PP in North America – 3 plants: La Porte - TX, Marcus Hook - PA and Neal - WV – Research & Tech Center: Pittsburgh, PA – Competitive margins – Well-located and state-of-the-art facilities run by experienced employees 1 The Phenol Business does not form part of this transaction 3
  4. 4. Benefits and Strategic Drivers • Further internationalization of a world scale player • Acquisition of upgraded and competitive assets with access to a highly skilled management team and workforce • Development of a base of global production in a market with further industry consolidation opportunities • Foothold in the U.S. enhancing market for greenfield projects in Latin American • Value creation Adding Sunoco Chemicals to the Braskem group furthers our objective of being among the top 5 global petrochemical companies in the world. 4
  5. 5. Polypropylene Market in the U.S. • Polypropylene resins are one of the fastest-growing categories of thermoplastic resins in the world • SRI estimates PP consumption growth at 1.3 – 1.7 times US GDP growth • U.S. is the largest global consumer of PP at 12% of global production • 5 largest producers have over 60% of the market • Producers out of the Gulf hub have feedstock competitive advantage • Sunoco is amongst the most competitive in the US PP industrySource: UBS 5
  6. 6. Sunoco Chemicals Overview • State-of-the-art R&T center and facilities operating SpheripolTM and UNIPOLTM PP technologies – Established industry reputation for providing high quality products and services – Superior safety record • Serves a broad range of clients with top 10 customers accounting for 52% of total sales volume • Favorable cost position and feedstock integration – Ability to access lower cost feedstock with 60% of total capacity located outside US Gulf Coast – Robust transportation infrastructure • Flexible product mix including high margin products • Strong management team and workforce – Recent restructuring without material impact to the businessSource: Sunoco Inc 6
  7. 7. Braskem - # 1 Resin Producer in the Americas, now with plants in the USA Key Financials (2009 LTM* ProForma): Resins capacity (kton/y) 6,460 Gross Revenue R$ 27.3 billion 510 Net Revenue R$ 20.8 billion EBITDA R$ 3.0 billion Total Assets R$ 34.6 billion 2,915 *LTM: oct/08 to sep/09 PVC Profile: PP PE 29 petrochemical plants : 26 in Brazil and 3 in the USA 3,035 Listed on 3 stock exchanges: BM&FBovespa, NYSE and LatibexSource: Braskem / Company estimates 7
  8. 8. Sunoco Chemicals acquisition does not change Capital Structure and Leverage • Strong liquidity with cash and cash equivalents of approximately R$8 billion (US$4.3 billion) • Capital structure with significant capacity (net debt/EBITDA) of approximately 3x Estimated Capital Estimated Capital ProForma Increase R$4.5bi – Increase R$4.5bi – Sep 09 Sunoco Chemicals Quattor Acquisition Acquisition Cash & Cash Equiv. 4,274 8,074 7,444 Gross Debt 17,470 17,470 17,470 Net Debt 13,197 9,397 10,027 Net Debt / EBITDA 4.55x 3.24x 3.30xSource: Braskem, Unipar and Sunoco Inc 8
  9. 9. Strategic Roadmap 2020 Objective: Leader in the Americas, rank among the 5 largest petrochemical companies worldwide and to be positioned as the preferred partner for global alliancesSource: Braskem 9
  10. 10. Acquisition of Sunoco ChemicalsBernardo Gradin Carlos Fadigas