Sibur and TAIF to merge to create top-5 global plastic, rubber producer

London, (Quantum Commodity Intelligence) - Russian petrochemical producers Sibur and TAIF are to merge businesses in a deal that will see the new entity become one of the world's five biggest producers of rubber and polyolefins, Sibur said in a statement Friday.

The deal will see the current shareholders of TAID receive a 15% stake in the new company in return for handing a controlling stake in TAIF's group of petrochemical and energy firms.

"The consolidation of our assets and professional teams will increase the productivity of leading petrochemical enterprises and significantly strengthen the position of the Russian petrochemical industry in the global market," said Dmitry Konov, chairman of Sibur's board.

The new company will expedite TAIF's existing strategy to invest RUB1.5 trillion ($20m) in assets over the next decade.

Sibur, the biggest petrochemical producer in eastern Europe and Europe's third, is 80% owned privately, with Leonid Mikhelson the largest sharholder with 48.5%

The other 20% is owned by Chinese oil major Sinopec and the Silk Road fund.

Sibur is expanding rapidly in Russia, investing $9 billion in a new polyolefin projct in Tobolks that will consist of a steam cracker with the capacity or produce 1.5mtpa of ethylene and 400,000 mtpa of propylene. 

Last year, the company started work on its Amur Gas Chemical Complex that will use SIberian gas to produce 2.3 mtpa of polyethylene and 400,000 mt of polypropylene.