The new company will support Russia's leadership in the chemical, petrochemical and oil & gas sectors while making the country's products more globally competitive.
SIBUR International GmbH and TAIF Group have entered into an agreement finalizing the creation of a combined entity that will leverage the facilities of PJSC SIBUR Holding and create the largest petrochemical company in Russia and one of the biggest in the world.
Under the agreement, TAIF shareholders will receive a 15% stake in the new combined company in exchange for 50% plus 1 share in JSC TAIF. To ensure faster integration and higher efficiency of the combined entity's operations and investment program, the parties have agreed on an early exercise of an option for the remaining stake of TAIF's shareholders. SIBUR's financial obligations in the second phase of the transaction will be secured by several issues of exchange-traded bonds. As a result, in a matter of days required to finalize the deal the combined entity will consolidate 100% of the shares of TAIF Group, which includes petrochemical and energy companies.
The new company will support Russia's leadership in the chemical, petrochemical and oil & gas sectors while making the country's products more globally competitive thanks to economies of scale, higher production efficiency, better sales processes and improved customer service in line with global best practices.
Following the completion of all ongoing investment projects, the new combined company will be among the top 5 producers of polyolefin and rubber globally. The company's investment program will yield further growth of chemical non-commodity exports and import substitution, and also unlock new ways of tackling sustainability and environmental challenges.
The deal brings together the two companies' vast expertise in major investment projects and facilitates efficient distribution of feedstock, which will boost Tatarstan's petrochemical cluster and pave the way for new partnerships with the region.
As part of the transaction, Rustam Minnikhanov, President of Tatarstan, and Leonid Mikhelson, Chairman of the Board of Directors at PJSC SIBUR Holding, signed a cooperation agreement between the Tatarstan government and the company. The parties agreed to work together to boost Tatarstan's economic strength and create a favorable investment climate in the region.
Some of the priorities outlined in the agreement include cooperation in:
- Sustainable development, including implementation of projects to cut emissions and improve the collection and recycling of polymer waste;
- Key areas of SIBUR Holding's Formula for Good Deeds social investment programme;
- Improving quality of life through charitable and sponsorship assistance in the social sphere;
- Promoting investment, R&D and innovations in Tatarstan;
- Design and implementation of joint PPP projects;
- Implementation of projects to foster communication and cooperation with SMEs;
- Training of skilled labour in petrochemicals and energy.
SIBUR is Russia's largest integrated petrochemical company and one of the fastest growing global petrochemical players with more than 17,000 employees. The Company's unique vertically integrated business model enables it to deliver highly competitive products used in the consumer goods and automotive industries, as well as construction, energy, chemistry and other industries across 100 countries.
JSC TAIF is the parent company of the largest private group in Russia. JSC TAIF was incorporated in August 1995. The group's key business lines include oil refining and gas processing, chemicals and petrochemicals, energy, and investments. Its chemical and petrochemical product portfolio comprises 581 commodities, with around 40% of products exported.
In Russia, TAIF Group is one of the biggest plastics producers and the leader in the production of all types of rubbers. Additionally, the group tops the list of the world's biggest isoprene rubber producers.