Mexican chemical company Alpek is in exclusive talks with Brazil’s Petrobras to buy the Brazilian group’s stakes in Companhia Petroquímica de Pernambuco (Petroquímica Suape) and Companhia Integrada Têxtil de Pernambuco (Citepe). Negotiations are to take place during a 60-day period that started on Jul 28  and may be extended by 30 days.

Petroquímica Suape and Citepe operate an integrated PTA/PET facility in Ipojuca, Pernambuco, Brazil, with a capacity of 700,000 t/y PTA and 450,000 t/y PET. Citepe also operates a 90,000 t/y texturized polyester filament plant at the site. The Mexican company is expected to offer as much as $700 million for the stakes, according to the news agency Reuters.  The petrochemical producers have accumulated losses of $1.7 billion over the past two years, including impairment charges related to Brazil’s largest-ever corruption probe.

A sale would reduce Petrobras’ debt and provide a cash injection into the plants. If both parties reach an agreement, Alpek said the transaction will require further corporate approvals as well as the usual regulatory clearances.