Dow Canada Divests Chlor-Vinyl Business in Western Canada
Dow Chemical Canada Inc. (Dow Canada) announced today it has signed an agreement to sell Dow’s caustic soda business in Western Canada to Univar Canada Ltd. This sale includes the West Coast Distribution Centre (WCDC) terminal assets which consist of marine, rail and truck facilities in North Vancouver, British Columbia, as well as miscellaneous equipment. Close of the transaction is expected as soon as practicable in 2007, subject to regulatory approval. Dow, the largest global marketer of caustic soda, is maintaining its caustic soda business in the remainder of the world, including Eastern Canada.
“The decision to divest this business is aligned with our ongoing drive to improve the global competitiveness of The Dow Chemical Company,” said Philippe Raynaud de Fitte, business vice president, Chlor-Vinyl and VAM. “Since we shut down chlor-alkali production at Fort Saskatchewan in 2006, Dow’s role in the Western Canada chlor-alkali business has been one of distribution. This does not fit with our established business model in which raw material supply, manufacturing and distribution are fully integrated to maximize competitive advantage.
“Univar is ideally suited to take over this business,” Raynaud de Fitte continued. “We anticipate little to no disruption to our customers as they transition to their new supplier.”
The WCDC was built in 1980 to be Dow Canada’s transfer facility for the increasing quantities of products manufactured at the company’s Fort Saskatchewan, Alberta site. In October 2006, Dow shut down the chlor-alkali and direct chlorination ethylene dichloride (DC-EDC) production facilities at Fort Saskatchewan, but had continued to use the WCDC to supply caustic soda to customers in Western Canada.
Dow is the world’s leading caustic soda solution producer. Caustic soda is an essential ingredient in an array of industrial operations, including pulp and paper, textiles, soap and detergents, bleach, petroleum products and alumina, along with many other uses in the chemical processing industry. The predominant use in Western Canada is in pulp production.
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