Following the approval of all relevant antitrust authorities, the new synthetic rubber joint venture of Lanxess and Saudi Aramco will start life on April 1 under the name Arlanxeo. The future partners said the name and logo combine elements from both, with the descriptor Performance Elastomers highlighting the product range – Lanxess’ rubber business was formerly part of its business unit Performance Polymers.

Managed by a holding in the Netherlands, the jv will be the world’s largest producer of synthetic rubber with annual sales of €3 billion and an enterprise value of €2.75 billion. Its

activities will include development, production, marketing, sale and distribution of synthetic rubber for tire industry, automotive parts and other applications.

After a long search for a buyer or joint venture partner for the ailing business, Lanxess clinched the deal with Saudi Aramco Overseas Company, a subsidiary of the Saudi Arabian oil giant, in September 2015.

Under the agreement, the Saudi partner is paying its German counterpart around €1.2 billion in cash for the 50% stake after deduction of debt and other financial liabilities.

Lanxess CEO Matthias Zachert said earlier his company would invest about quarter of the proceeds in its Advanced Intermediates and Performance Chemicals businesses, with the remainder going toward paying down debt and buying back shares.

The final management team is to be announced in the near future. The companies announced earlier that CEO will be appointed by Lanxess, the CFO by Saudi Aramco. Zachert will head the board of directors, on which the partners will be equally represented.

“With this joint venture of the world’s largest producer of synthetic rubber and the world’s largest integrated energy company, we have laid the foundations for the sustainable and positive development of Arlanxeo,” said Zachert.