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Bain Capital wins Styron auction with $1.63bn bid

2 Mar 2010

Bain Capital, a Boston-headquartered private equity firm, has reached an agreement with Dow Chemical to buy its Styron unit for $1.63bn, beating bids from rivals TPG and Apollo.

As part of the transaction, Dow has an option to keep 15 per cent of the equity of the plastics business.

The sale will allow Dow to substantially deleverage its balance sheet.

Andrew Liveris, chairman and CEO of Dow Chemical, said, “We are committed to further focusing our portfolio by shedding non-strategic assets that can no longer compete for growth resources inside the company, and in the process generating funds for further debt reduction.”

Styron includes the company’s polystyrene, ABS, SAN, PC, styrene monomer, styrene-butadiene rubber and latex assets, and, based on 2009 data, is expected to generate around $3.5bn in annual revenue.

Bain Capital, a major buy-out player with around $65bn in assets under management, is reportedly expecting to launch a yuan-denominated China fund in the next 18 months.

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