BP petrochem unit breaking away to form own company

InTech, Jun 2004

BP's Olefins and Derivatives (O&D) division of its petrochemicals business plans to go it alone as a stand-alone entity able to operate separately from the BP Group.

The new O&D business will incorporate more than half of the $13 billion of operating capital in BP's petrochemicals portfolio.

BP said it plans to sell O&D possibly through an initial public offering, depending on market circumstances and necessary approvals, in the second half of 2005.

The company will retain the rest of its petrochemicals unit, which consists of the aromatics and acetyls businesses.

"We have now concluded that divesting O&D-perhaps by means of an IPO, subject to market conditions and any necessary consents-is likely to deliver the best returns to our shareholders and to be in the best long-term interests of the O&D business itself," said BP chief executive Lord John Browne.

The O&D business employs 7,500 people in 24 locations worldwide, chiefly in the U.S. and Europe.