Brazil's Braskem To Buy Dow Chemical Unit For $323 Million

Braskem SA (BRKM5.BR, BAK), Brazil's biggest petrochemical company, said Wednesday it agreed to pay $323 million for Dow Chemical Co.'s (DOW) polypropylene unit, making it the U.S.'s biggest producer of the chemical used to make plastics.

Braskem's U.S. unit, Braskem America Inc., will pay the amount in cash when the deal is completed, according to a Brazilian regulatory filing. The polypropylene business, with two locations in Texas and two in Germany, has the capacity to produce about 950,000 tons of the chemical a year, Braskem said in the filing. The Texas plant will increase Braskem's U.S. capacity by 505,000, or about 50% of its current output capacity in that country.

The deal, which has to be approved by antitrust and securities regulators in Brazil, the U.S. and Europe, will also involve supply contracts with Dow and third parties, Braskem said.

-By Paulo Winterstein, Dow Jones Newswires; 55-11-3544-7073; paulo.winterstein@dowjones.com

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