BEIJING (Reuters) - Chinese state-owned chemical companies Sinochem Group and ChemChina are in discussions about a tie-up to create a global chemical, oil and agricultural giant with almost $100 billion in annual revenue, three sources familiar with the matter said.
Measured by revenue and profits, Sinochem is much larger than its rival ChemChina, which is finalizing a $43 billion takeover of Swiss pesticides and seed group Syngenta. That deal would be China’s largest-ever foreign investment.
Here are some key facts about how a merged entity would look:
Based on 2015 annual reports and measured in U.S. dollars:
ChemChina Sinochem Combined Syngenta
Revenue $38.99 $60.4 $99.4 $13 billion
billion billion billion
Net profit $17.55 $483.6 $501 $1.64
million million million billion
Assets $55.78 $54.6 $110.4 $18.98
billion billion billion billion
Workforce more than 46,225 more than 28,000
Makes everything from refined oil products, medical latex gloves to insecticides and tyres across six business units: advanced chemical materials and specialty chemicals, basic chemicals, oil processing, agrochemicals, tire and rubber products and chemical equipment.
It controls eight A-share listed companies.
Petroleum is its largest business, accounting for half of total 2015 revenue from nine refineries with combined annual crude oil processing capacity of 25 million tonnes.
New chemical materials and special chemicals was the second biggest business with 51.8 billion yuan ($7.77 billion) in revenue; Followed by, agrochemicals: 27.1 billion yuan ($4.06 billion); rubber products: 24.46 billion yuan ($3.67 billion); basic chemical products and equipment: 11 billion yuan ($1.65 billion).
One of China’s four state oil companies, the nation’s biggest fertilizer, seed and agrochemicals company and a major chemical service company. It also has real estate and non-banking financial service businesses.
Energy was one of its largest businesses, with revenue of 25.4 billion yuan ($3.8 billion) last year.
Controls 240,000-barrel-per-day Quanzhou refinery and owns a minority stake at the 50,000-bpd independent Hongrun Petrochemical Corp; Sinochem plans to expand into petrochemicals at its Quanzhou plant by adding a large ethylene complex.
Owns production oil and gas production assets in Brazil, Colombia and the Middle East, and shale field in Texas.
Produces herbicides, insecticides, fungicides and seeds, operating in 90 countries.
Europe, Africa and Middle East was its largest region, generating $3.88 billion in revenue last year, just under a third of the group total.
Reporting by Muyu Xu and Josephine Mason; Editing by Lincoln Feast