ExxonMobil May Sell Elastomers Business
A deal could help the energy and petrochemicals group pare down some of its debt burden, which had risen to $45.5 billion at the end of 2020. Exxon has reportedly hired investment bank Morgan Stanley to solicit interest from potential buyers, including private equity investors.
After an historic loss of $22.4 billion last year, the Texas, USA-based group is struggling to convince investors that it can potentially rebound after years of overspending and a much criticized lack of investment in cleaner fuels.
In elastomers, Exxon is known for its Santoprene-brand thermoplastic vulcanizates (TPVs) used in automotive, industrial and consumer products. This business was launched in 1991 as a limited partnership between ExxonMobil Chemical and Solutia, then a spinout of Monsanto. Exxon took full ownership of it in 2002.
The global TPV market is poised to grow from $1.6 billion in 2019 to $2.6 billion in 2027, according to a report by ResearchAndMarkets.com. However, the industry has been adversely affected by the Covid-19 pandemic due to plant shutdowns and supply chain issues.
Author: Dede Williams, Freelance Journalist
-
Exxon Mobil is exploring a sale of its Advanced Elastomer Systems (AES) division, potentially valuing it at around $800 million including debt, Reuters said. A sale could help pare down a $45.5 billion debt burden. The group reported an historic loss of $22.4 billion last year. (c) Tasos Mansour
