Covestro and Wanhua Chemical Carve Up the Industry’s No. 3 Player

Recently, Covestro announced that it has signed an agreement with Vencorex, a subsidiary of Thai chemical company PTT Global Chemical (PTTGC), to acquire two independent hexamethylene diisocyanate (HDI) derivatives production sites located in Rayong, Thailand, and Freeport, USA, respectively. The transaction is expected to be completed by the end of 2025.

This is Covestro's first major move after announcing its semi-annual performance, despite the pressure on its performance. It is reported that Covestro completed the acquisition of DSM Group's Resins and Functional Materials business (RFM) for $1.886 billion in 2021, helping it become the world's largest producer of coating resins.Through this acquisition, Covestro has supplemented its existing production capacities in the United States, Germany, China, and India, further demonstrating the company’s strong confidence in its coatings and adhesives business.

It is reported that the company being acquired this timeVencorex's operations in France primarily include an HDI monomer production capacity of 79,000 tons per year and an HDI derivatives production capacity of 24,000 tons per year; in the United States, it has an HDI derivatives production capacity of 12,000 tons per year; in Thailand, it also has an HDI derivatives production capacity of 12,000 tons per year.Due to the European energy crisis following the Russia-Ukraine war, its subsidiaries Vencorex France and Vencorex TDI are in trouble.September 10, 2024Enter the judicial reorganization process.

At around the same time, Wanhua Chemical submitted through its Hungarian subsidiaryBorsodChem Vencorex's specialty isocyanate business in France. Proposal,April 10, 2025The Commercial Court of Lyon in France has approved the acquisition.。

The transaction is reportedly valued at approximately 1.2 million euros, with a commitment to invest 19 million euros by 2027. It involves Vencorex's production site near Grenoble, France, as well as its only HDI monomer production facility.

At this point, the two major chemical giants have completed the "division" of Vencorex. Wanhua is "expanding" in Europe, while Covestro is "encircling" in Asia.

Currently, Wanhua ChemicalHDI total production capacity reaches 200,000 tons/yearNingbo 100,000 tons/year, Yantai 30,000 tons/year, Kangrui 70,000 tons/year）With the addition of the 100,000-ton technological transformation in Ningbo, it will reach 300,000 tons in the future.Covestro 190,000 tons/year; Tosoh Japan,After the expansion is completedHDI has an annual production capacity of 30,000 tons; Asahi Kasei, 22,000 tons/year.

It is worth mentioning that the domestic dark horse, Meirui New Materials, has formed with its Henan subsidiary's Phase I project of the polyurethane industrial park, the HDI monomer plant.A production capacity of 100,000 tons of HDI monomer and its derivatives has achieved a breakthrough, rising to third place globally in this field, with an additional 200,000 tons under construction. Furthermore, New Harmony is in the process of building.100,000 tons.

HDI is a key component in products such as polyurethane coatings, adhesives, and sealants, and is widely used in various fields including automobiles, trucks, bridges, ships, wooden furniture, and electronic products. Among these, the automotive sector is the largest market.Electrophoretic paint, ultra-wear-resistant floor paint, protective coatings for wind turbine blades and towers, photovoltaic backsheet structural adhesive, and other emerging fields are also experiencing rapid growth in application.