LyondellBasell (LYB), a global leader in the chemical industry and a top producer of polymers and polyolefin technologies, has announced a transformative agreement to sell select European olefins and polyolefins assets to AEQUITA. This strategic move, announced on June 5, 2025, marks a significant phase in LYB’s transformation initiative titled “Grow and Upgrade our Core,” emphasizing the company’s commitment to operational safety, sustainability, and value creation in its core markets, notably Europe.
The assets involved include strategically located sites in Berre (France), Münchsmünster (Germany), Carrington (UK), and Tarragona (Spain), forming a substantial olefins and polyolefins platform close to a longstanding customer base and key infrastructure. AEQUITA, an industrial investment group with a €3.5 billion revenue portfolio, aims to enhance these assets operationally, bringing long-term value through their expert management approach.
This divestiture follows LYB’s strategic review initiated in mid-2024, where approximately 13% of its global olefins and polyolefins capacity in Europe was identified as non-core to its future portfolio. LYB executives emphasized that these assets do not align with the company’s growth and profitability criteria, similar to previous divestitures including their Ethylene Oxide & Derivatives business and plans to shut down the Houston refinery by early 2025. The management highlighted that such moves will likely enhance LYB’s EBITDA margin by about 4 percentage points, underlining a robust margin improvement strategy.
From a financial perspective, LYB reported total revenues of approximately \(40.3 billion and net income of \)1.36 billion for fiscal year 2024. The company’s revenue saw a slight decline of around 2% year-over-year, impacted by portfolio repositioning and selective strategic exits. Despite this, LYB maintained a strong operational cash flow and capital returns, achieving a 95% EBITDA to cash conversion rate and returning $1.8 billion to shareholders in dividends and share buybacks.
The sale to AEQUITA is anticipated to close in the first half of 2026, subject to regulatory approvals and employee consultations at the impacted sites. LYB will retain a strong presence in Europe, focusing on profitable leadership in circular and renewable solutions and technology advancements, including investments near Cologne for their circular and renewable product sets.
This transaction highlights key sector trends: capital intensity, a pivot toward sustainable and circular economies, and portfolio optimization to maximize shareholder value. LYB’s strategic divestment aligns well with sector best practices and positions the company to leverage growth opportunities in advanced polymer solutions, renewable feedstocks, and technology leadership.
Incorporating insights from LYB’s 2024 earnings call, the company stressed “LyB’s Value Enhancement Program is a new way of working, focused on unlocking value and embedding profitability into the company culture.” CEO Peter Vanacker noted, “Europe remains a core market for LYB, where we aim to establish profitable leadership in circular and renewable solutions post-transaction.” Meanwhile, CFO Michael McMurray highlighted disciplined capital allocation with robust cash generation, ensuring the company can invest in growth while rewarding shareholders.
In summary, LYB’s ongoing European strategic assessment and recent asset sale underscore a deliberate portfolio sharpening approach to enhance financial resilience and sustainability leadership in the materials sector. Investors should monitor the transaction’s progress and future earnings impact, considering the company’s adept management of its capital-intensive asset base and market dynamics.
For complete details, please refer to the original SEC filing here.
Tags: LYB, LyondellBasell, FY2024, EuropeanAssetSale, CircularEconomy, ChemicalIndustryTransformation