Solutia to Buy Out Mexican Joint Venture Partner
Monday November 28, 4:25 pm ET
Transaction Will Help Meet Increasing Global Demand for Solutia PVB Interlayers Used in Automotive and Architectural Applications
ST. LOUIS and PUEBLA, Mexico, Nov. 28 /PRNewswire-FirstCall/ -- Solutia Inc., the world leader in the production and sale of polyvinyl butyral (PVB) interlayers, today announced it has reached a definitive agreement with Vitro Plan, S.A. de C.V. (NYSE: VTO; BMV: VITROA), to purchase Vitro Plan's 51 percent stake in its joint venture with Solutia, known as Quimica M, S.A. de C.V. As a result, Solutia will become the sole owner of Quimica M. Additionally, Solutia and certain affiliates of Vitro Plan will be entering into agreements under which Solutia will supply those Vitro affiliates with 100 percent of their requirements for Saflex® and Vanceva® PVB interlayer products. This purchase and the related transactions are subject to bankruptcy court approval, the approval of the parties' respective boards of directors, and the Mexican Competition Commission.
The Quimica M joint venture produces PVB interlayers at a plant in Puebla, Mexico. These interlayers are used by major glass producers such as Vitro to make laminated glass for use in automobiles and buildings.
"This acquisition is another important step forward in our reorganization," said Jeffry N. Quinn, president and CEO, Solutia Inc. "One of the basic tenets of our reorganization strategy is to improve our asset portfolio. This acquisition, in addition to the recently announced construction of our Laminated Glazing Interlayers (LGI) plant in Suzhou, China, significantly enhances the strategic position of our LGI business."
Mitch Pulwer, general manager of Solutia's LGI business, said, "Solutia has a long history working with Vitro Plan and affiliates to grow its glass business. We look forward to continuing and strengthening this important relationship."
Pulwer added, "This transaction is an important component of the strategy to optimize our worldwide production of PVB interlayer for the benefit of our customers. The Puebla plant offers a proven supply of the world's premier PVB interlayers. As a result, we will have greater flexibility in meeting the needs of customers and in scheduling our worldwide manufacturing operations as efficiently as possible. And, we will continue to invest throughout the world as both technology and capacity needs arise."
Commissioned in 1995, the Puebla plant operates state-of-the-art PVB interlayer manufacturing lines using the same Solutia technology used at other Solutia production sites. The plant is ideally situated to allow Solutia to directly supply PVB interlayers to the growing Mexican market, as well as to customers in other world areas.
"The LGI business plays a critical role in our growth strategy for the Performance Products Division," said Luc De Temmerman, president of Solutia's Performance Products Division. "As a global division, we are continuously evaluating opportunities to further develop our presence in areas with significant growth potential, such as Mexico and China."
This agreement comes less than three months after Solutia announced that it is beginning construction of a new Saflex and Vanceva PVB interlayer plant in Suzhou, China. Solutia's LGI business presently manufactures PVB interlayers at Ghent, Belgium; Sao Jose Dos Campos, Brazil; Springfield, Mass., USA; and Trenton, Mich., USA. It also has a PVB finishing center, distribution center and regional customer service center in Singapore.
In addition to being the world's largest producer and seller of PVB interlayers, Solutia is the global leader in PVB innovation, quality and reliability. When laminated between layers of glass, PVB interlayers greatly enhance the performance characteristics of glass, providing benefits such as security, solar protection, sound attenuation, safety and style. Laminated glass made with Saflex PVB is used in applications for automobiles and buildings. In addition to Saflex, Solutia manufactures Vanceva high- performance interlayers, providing customers the world's most innovative portfolio of laminated glass interlayers.
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