SSL Sasol Ltd

By Robb M. Stewart

LyondellBasell Industries' shares strengthened Friday after the chemicals and refining company struck a deal to buy half of certain Sasol Ltd. assets in Louisiana for $2 billion and form a joint venture.

In morning trading, the shares were 3.8% higher at $70.73. They are 25% lower year-to-date.

LyondellBasell said it signed a definitive agreement to buy 50% of the South African company's ethane cracker, low and linear-low density polyethylene plants and associated infrastructure. The deal includes rights for each partner regarding the potential future sale of its ownership interest.

Under the terms of the agreement, each joint-venture partner will provide pro-rata shares of ethane feedstocks and will take pro-rata shares of cracker and polyethylene products at cost. LyondellBasell will operate the U.S. base chemicals assets on behalf of the 50-50 joint venture.

Some of Sasol's U.S. employees will become employees of LyondellBasell. Sasol will retain full ownership and operational control of its Lake Charles Research and Development complex, Lake Charles East Plant ethane cracker and U.S. Performance Chemicals Business assets in Lake Charles, which produce Ziegler alcohols and alumina, ethoxylates, Guerbet alcohols, paraffins, comonomers, linear alkyl benzene, ethylene oxide and ethylene glycol

The assets of the venture, which will operate under the name Louisiana Integrated PolyEthylene JV LLC, are located on the U.S. Gulf Coast. LyondellBasell said its investment allows it to expand in a core area of its business and it will realize immediate returns and eliminate customary construction risks associated with new projects.

Write to Robb M. Stewart at robb.stewart@wsj.com

(END) Dow Jones Newswires

October 02, 2020 10:45 ET (14:45 GMT)

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