SABIC’s Portfolio Moves in Europe and the Americas

SABIC’s recent divestments in Europe and the Americas were not unexpected, given the high cost of production in Europe and persistent global oversupply. What is encouraging, however, is that these assets are being divested rather than permanently shut down, preserving optionality for employees, customers, and regional supply chains.

AEQUITA’s acquisition of SABIC’s European petrochemical assets reflects this reality. These assets have faced structural cost disadvantages for years, and under current market conditions, portfolio optimization was inevitable. The transaction also opens the door for consolidation, restructuring, and potentially improved asset utilization under a financial owner with a different operating model. It will be interesting to see how AEQUITA does that having already struck a deal for LyondellBasell’s assets.

Mutares SE & Co. KGaA’s acquisition of SABIC’s Engineering Thermoplastic (ETP) assets in Europe and the Americas follows a similar logic. These were high-cost, low-growth assets that have underperformed since 2023. After the initial post–Russia-Ukraine war price spike, polymer prices declined and have remained depressed amid weak demand, eroding margins.

A market recovery was widely anticipated following monetary easing by European and U.S. central banks, but that recovery has not materialized — despite multiple rate cuts. As a result, these assets continued to struggle in an environment of subdued demand and excess capacity.

SABIC had clearly signaled this direction earlier. After closing its cracker units in Geleen and Teesside, the company stated during its Q2 FY 2025 earnings call (August 2025) that it was pursuing divestment — not closure — of its European petrochemical and American and European ETP assets, having already designed a “soft carve-out.”

At the same time, SABIC has been actively reallocating capital toward growth regions. In August 2024, the company increased its investment commitment in China, signing a potential agreement with the Fujian government to build an engineering thermoplastic compounding plant in Zhangzhou, alongside the planned polycarbonate unit within the larger cracker complex.

The speed of execution on the ETP sale underscores the urgency of the portfolio reset. However, the $450 million sale price (plus an earn-out mechanism) stands in stark contrast to the $11.6 billion SABIC paid for GE Plastics 19 years ago, highlighting how dramatically market conditions and asset valuations have shifted.

Importantly, the transaction does not include SABIC’s specialty brands — Ultem™, Noryl™, LNP™, and specialty PC — reaffirming SABIC’s intent to retain its higher-value, technology-driven portfolio.

These transactions reflect a pragmatic response to structural realities rather than a retreat from advanced materials. The broader signal is clear: global chemical producers are sharpening portfolios, reallocating capital to growth markets, and becoming far less willing to carry structurally underperforming assets in mature, high-cost regions.

For additional context on SABIC’s specialty portfolio strategy, readers can refer to the full Plastics News article by Frank Esposito, Plastics News Senior Reporter, which also includes my perspective: https://www.plasticsnews.com/suppliers/materials/pn-sabic-specialties/