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Saudi company to bid US$12 billion for GE Plastics: report

A prominent Saudi Arabian petrochemical firm is preparing a US$12 billion bid for General Electric Co.s Pittsfield...


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March 28, 2007 by Canadian Plastics

A prominent Saudi Arabian petrochemical firm is preparing a US$12 billion bid for General Electric Co.s Pittsfield, Mass.-based plastics division, according to the Financial Times.

In a report published earlier this week, the UK business publication reported that Saudi Basic Industries Corporation (SABIC) is putting together an offer before mid-April, when the first round of the auction is set to take place. The Financial Times did not make note of a source for the reported information.

SABIC is the largest public company in the Middle East, and a major player in the global petrochemical manufacturing industry. According to the company’s website, SABIC produces several different grades of polyvinyl chloride (PVC) and polyester. The firm also manufactures several different types of polypropylene (PP) and polyethylene (PE), and refers to itself as a major producer of polyolefins.

GE Plastics has refused to comment on potential suitors, but several companies are said to be interested in acquiring the division. Media reports have floated the names of several private equity firms that may be bidding for GE Plastics. Reuters has also reported that privately held Wichita, Kans.-based Koch Industries, Ltd. will be teaming up with a private equity firm in order to bid for the unit.GE’s chairman and CEO Jeff Immelt first announced the company’s intentions to “exit slower-growth and more volatile businesses” late last year.

The company’s Canadian headquarters are located in Mississauga, Ont.