KINGSPORT, Tenn. (WJHL) — Eastman Chemical Company announced Thursday a definitive agreement to sell its Texas City Operations for $490 million to INEOS Acetyls, a global manufacturer of acetic acid and related chemicals.
The Kingsport-based company will retain ownership of its plasticizer business at the Texas City, Texas site, which will be operated by INEOS. The two companies also plan to explore a long-term agreement for supplying vinyl acetate monomer to Eastman.
“We are happy to have reached this agreement with INEOS,” said Erwin Dijkman, Eastman’s division president of chemical intermediates. “They have been a strong partner with us at the Texas City site and have extensive experience and a complementary position in the acetyls space.”
The $490 million sale price consists of approximately $415 million cash, with the remaining amount to be paid in installments.
According to INEOS, all current employees at Eastman’s Texas City site will transfer over to INEOS.
“We are delighted to announce this strategic acquisition which will help drive our global ambition for our Acetyls business,” INEOS Acetyls CEO David Brooks said. “The site is ideally placed to take advantage of competitively priced feedstocks which will help support the growth of our business and sustainable future of the site.”
Eastman’s Texas City Operations is part of the company’s chemical intermediates segment. It acquired the facility in 2011.
The company said it will continue to manufacture acetyls at its Kingsport plant.
“As a global leader in acetyls, we remain committed to maintaining our position and to serving our current markets,” Dijkman said. “We will also continue to pursue attractive opportunities created by our integrated cellulosics stream in Kingsport, such as our recent growth in textiles and expected growth of our Aventa™ Renew compostable materials in food service applications.”
Eastman said proceeds from the sale in the near term are expected to go toward debt repayment. The company expects the sale to be accretive to adjusted earning per share in 2024.
The sale of the Texas City facility is expected to be completed in the fourth quarter of this year, pending regulatory approvals and satisfying closing conditions.
INEOS Acetyls is owned by global chemical manufacturer INEOS Group.