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<br />e <br />() Lronde" <br /> <br />e <br />t~IJ <br /> <br />Millennium <br />Chemical~ Inc. <br /> <br />FOR IlvfMEDIATE RELEASE <br /> <br />L YOND ELL AND MILLENNIUM COMBINE OLEFINS AND POLYMERS <br />BUSINESSES TO CREATE NEW $5 BILLION CHEMICAL COMPANY <br /> <br />Jointly-Owned Venture Expected to Improve Annual Profitability by $150 Million <br />and Reduce Effects of Industry Cyclicality on its Parent Companies <br /> <br />HOUSTON, ISELIN, N,J. and LONDON, July 28,1997 -- Lyondell <br />Petrochemical Company (NYSE:L YO) and Millennium Chemicals Inc. (NYSE:MCH) <br />have signed a definitive agreement to form a new venture, with expected revenues of <br />approximately $5 billion, comprised primarily of the olefins and polymers businesses of <br />the two companies. <br />The new company is expected to be the largest producer of ethylene and <br />polyethylene in North America. It will consist of 13 manufacturing facilities on the U.S. <br />Gulf Coast and in the U.S. Midwest, producing ethylene, propylene, polyethylene, <br />polypropylene, ethyl alcohol and associated products. The combination will create a <br />strong financial entity with book assets of approximately $5 billion. It plans to have <br />$1.745 billion of debt, with a note receivable from Lyondell of$345 million, and <br />substantial free cash flow. <br />The new venture company, which will be operated as a partnership, will be owned <br />57% by Lyondell Petrochemical Company and 43% by Millennium Chemicals Inc. The <br />venture's governance structure will include a six-person committee, co-chaired by Dan F. <br />Smith, President and Chief Executive Officer of Lyon dell, and William M. Landuyt, <br />Chairman and Chief Executive Officer of Millennium. Smith also will serve as Chief <br />Executive Officer of the venture company, which will be headquartered in Houston, <br />Texas. <br /> <br />-MORE- <br />