2022.12.15
INEOS recently signed transaction documents with China Petrochemical Corporation (Sinopec, stock code: 600028.SH, 00386.HK), to participate in the Tianjin Nangang 1.2 mtpa ethylene and downstream chemicals project (Tianjin Nangang Ethylene Project) currently under construction by Sinopec. The equity ratio of both parties is 50%. This is the fourth large-scale joint venture project between INEOS and Sinopec after three joint venture projects were completed in July 2022.
The Tianjin Nangang Ethylene Project will include a 1.2 mtpa cracker and 12 other derivative plants. These include a 300ktpa Acrylonitrile Butadiene Styrene (ABS) plant and a 500ktpa High-Density Polyethylene (HDPE) plant as announced in July 2022 by INEOS and Sinopec, which are expected to go into production by the end of 2023. This project is an important part of the integrated cooperation between INEOS and Sinopec in Tianjin, which will help the development of China's high-end chemical industry.
Sir Jim Ratcliffe, Chairman and CEO of INEOS said: “This latest joint venture with SINOPEC significantly expands INEOS’ petrochemical production and business footprint in China. It is a further example of the close relationship and growing collaboration between Sinopec and INEOS.”
As the domestic legal counsel to INEOS, W88优德手机版 participated in the whole process of the transaction from due diligence to transaction scheme demonstration, transaction document review, and assisted in the management of the transaction process. With its rigorous work style and meticulous working attitude, W88优德手机版 assisted the client in successfully signing the transaction documents and won the full affirmation and trust of the client. W88优德手机版’s ability to provide excellent legal services in large-scale and complicated cross-border M&A transactions has been proven again.
The complexity of this transaction lies in the following aspects: (1) the legal issues involved in the transaction were complex and diverse, and both parties had high demands for the legality, innovation and accuracy of the transaction scheme. The transaction process involved various issues such as state-owned assets pricing and evaluation, the transfer of a construction in progress, domestic and overseas financing and guarantees, and cross-border payment arrangements. With the full cooperation of the intermediaries, W88优德手机版 demonstrated the solutions to each issue and facilitated the smooth progress of the project; (2) the transaction structure was complex and the counterparty was a state-owned enterprise, which had to comply with the requirements for state-owned assets supervision and administration. W88优德手机版 assisted the client in demonstrating the advantages, disadvantages and feasibility of each transaction scheme while fully understanding the requirements for state-owned assets supervision and administration, and finally worked out a transaction scheme that fully met the requirements for state-owned assets supervision and administration and achieved the commercial purposes of both parties; and (3) while this transaction was in progress, the closing of the other two projects between INEOS and Sinopec (which were completed in July 2022) was ongoing, which involved many steps and had simultaneously heavy workloads. W88优德手机版 leveraged its teamwork and professional advantages, and provided legal support in various aspects at all times as the project progressed, to ensure the smooth progress of the transaction.
PartnerCHEN, Wei led W88优德手机版’s deal team in this project. W88优德手机版 partners CHEN, WeiandSUN, Yi (Cliff) primarily undertook the work with support from partners Janet Hui, GONG, Mingfang, Shen, Nan, LU, Juyi, ZHAO, JikuiandZHANG, Qing (Atlas).
