Plastics and rubber M&A activity has been fueled by larger companies and private equity groups looking acquire new technology to add to existing divisions or portfolio companies. As the economy continues to grow the plastics and rubber sector should see continued M&A activity.
According to First Research, an industry research organization, US plastics and rubber manufacturers stand to benefit from the US boom in natural gas shale plays, according to Trib Total Media. US production of ethane, a natural gas liquid, has increased significantly from shale plays including the Marcellus, Utica, and Bakken shale formations. In processing plants called ethane crackers, ethane is produced from natural gas. Ethane is then used to produce ethylene, the key ingredient in polyethylene plastic. Royal Dutch Shell is reported to be considering the construction of a new ethane cracker in Beaver County, Pennsylvania, to process natural gas from the Marcellus Shale. The US division of Brazilian petrochemical firm Braskem is proposing construction of an ethane cracker in West Virginia.
Posted by Jim Zipursky.