April 13 (Bloomberg) -- Grupo Zuliano CA will buy a 35 percent stake in a Venezuelan propylene plant from Koch Industries Inc., Armando Sandoval, general manager of the Maracaibo-based company, said today.
The transaction, valued at about $35 million, will be completed by April 30, said Sandoval in a phone interview.
Grupo Zuliano, a Maracaibo-based holding company whose subsidiaries produce chemicals and plastics, previously had a 15 percent stake in Propileno de Falcon CA, known as Profalca, and will now hold 50 percent. A unit of Venezuelan state-run chemicals company Pequiven SA holds the remaining amount. The acquisition was approved in a shareholders meeting yesterday, Sandoval said.
“Koch wanted to exit the joint venture,” said Sandoval. “We want to consolidate our business with Pequiven and for that reason are increasing our stake.”
Koch’s divestment of the propylene plant stake comes after its 35 percent stake in the FertiNitro Venezuelan fertilizer joint venture was nationalized by President Hugo Chavez in 2010. Koch Industries last year filed for arbitration against Venezuela at the World Bank’s International Centre for Settlement of Investment Disputes, or ICSID, to seek compensation.
Melissa Cohlmia, a spokeswoman for Wichita, Kansas-based Koch, did not immediately respond to an e-mail and a phone message left today seeking comment.
Profalca, the joint venture formed in 1997, invested $70 million to build a chemical plant that makes propylene, a raw material used to make a plastic that goes into car parts, toys and household items.
To contact the editor responsible for this story: Dale Crofts at email@example.com