Mexichem in British Vinyls Acquisition

Mexican petrochemicals and plastics producer Mexichem has acquired Vinyl Compounds Holdings (VCHL), a Derbyshire, UK-based manufacturer of technical PVC compounds. The British company with sales of $40m in the fiscal year ended 30 September 2016 supplies the construction industry with pipes and profiles, along with the footwear and consumer goods sectors. Terms of the transaction were not disclosed.

With VCHL under its belt, Mexichem said it will be in a better position to react to growing global demand for PVC compounds. The takeover will also integrate its compounds business vertically, adding stabiliser technologies and recycled PVC capabilities. The PVC resins and plasticizers in the British compounder’s portfolio are projected to have synergies with Mexichem’s vinyls portfolio. The two businesses will be integrated within the Compounds business unit of the Mexican player’s Vinyl Business Group.

The acquisition of VCHL is part of Mexichem’s strategy to grow through bolt-on acquisitions, said Sameer S. Bharadwaj, president of the Compounds business. He said new acquisitions should provide access to new geographies and end markets as well as expanding the group’s portfolio of specialty products and enhancing returns on invested capital.

With assets and operations in 30 countries and more than 18,000 employees, Mexichem has annual sales of $5.7 billion. The compounds business accounts for around $2 billion.