In a $2.1 billion deal that will expand its Gulf Coast presence, Canadian firm NOVA Chemicals Corp. announced this morning plans to acquire Williams Partners LP’s stake in a Geismar olefins plant.
The deal, which is subject to regulatory approvals, also includes roughly 525 acres of undeveloped land adjacent to the plant and Williams’ interest in the Ethylene Trading Hub in Texas.
NOVA Chemicals says in statement it will offer jobs to all of the employees currently working at the Geismar plant, in which Williams has an 88.5% ownership interest. The deal is expected to close this summer.
“This transaction provides us with the opportunity to acquire an operating facility with immediate, positive cash flow, and with access to new customers and the benefits of an experienced workforce,” says NOVA Chemicals President and CEO Todd Karran in a statement. “A key component of our growth strategy is to expand to the U.S. Gulf Coast and leverage next generation technology to better serve our customers in the Americas.”
Karran says the acquisition also will diversify NOVA’s geographic footprint, and increase access to U.S. shale reserves and petrochemical and supply chain infrastructure.
“Coupled with our recent announcement regarding our plans to form a joint venture with Borealis and Total in Texas, we have taken steps to firmly establish our presence on the U.S. Gulf Coast,” Karran says.
The olefins plant produces approximately 1.95 billion pounds of ethylene annually. It was the site of a 2013 explosion that killed two men and injured 167 others. Juries have awarded roughly $30 million in damages to injured employees.
