Qatar Petroleum (QP) is planning to integrate Qatar Vinyl Company (QVC), a part of Mesaieed Petrochemical Holding (MPHC), into Qatar Petrochemical Company (Qapco), an associate of Industries Qatar (IQ), a move that will optimise costs and improve profitability. The resulting entity would be a single company, Qapco, operating the facilities of both companies, as per a QP spokesman quoted in gulfnews.com. The integration would not result in any change to the shareholder ownership but allow the realisation of synergies through creating a single entity that operates the assets on behalf of both companies’ shareholders. IQ and MPHC are both Qatar Stock Exchange listed companies. Upon the integration, which is expected to start in March and complete before the end of the year, Qapco would be a single expanded and highly synergetic operating company fully managing Qapco’s and QVC’s current activities.
Qapco -- which is 80% owned by IQ and 20% by France’s Total Petrochemicals -- is engaged in the production and sale of ethylene, polyethylene, hexane and other petrochemical products; whereas QVC -- which is jointly controlled by QP, MPHC and Qapco -- is into sale of petrochemical products as caustic soda, ethylene dichloride and vinyl chloride monomer.
In 2016, Qapco had reported a profit of QR2.62 bln on revenue of QR3.89 bln; while QVC made a profit of QR170.48 mln on total revenue of QR1.44 bln.
“This integration aims to enhance the competitiveness, financial performance, and resilience of both companies. The shareholders of IQ and MPHC will directly benefit from this integration as it reduces the operating cost and enhance the profitability of both companies,” QP president and chief executive Saad Sherida al-Kaabi said. Qatar would pool the distinctive resources and capabilities of QVC and Qapco to create a higher value for both of their respective shareholders, while strengthening the global competitive position in the petrochemical industry, he said. "In line with our vision and commitment to building world-class Qatari talent, we will ensure that all Qatari nationals currently employed by QVC will be integrated into the new Qapco organisation,” al-Kaabi said.