Urethane Blog

Westlake Investors Information

February 24, 2022

WESTLAKE CORP Management’s Discussion and Analysis of Financial Condition and Results of Operations (form 10-K)

02/23/2022 | 01:21pm EST


We are a vertically integrated global manufacturer and marketer of performance
and essential materials and housing and infrastructure products. We have
historically operated in two principal operating segments, Vinyls and Olefins.
As a result of recent acquisitions, we reorganized our business into two
principal operating segments, Performance and Essentials Materials and Housing
and Infrastructure Products in the fourth quarter of 2021. Performance and
Essential Materials segment includes Westlake North American Vinyls, Westlake
North American Chlor-alkali & Derivatives, Westlake European & Asian
Chlorovinyls, Westlake Olefins and Westlake Polyethylene. Housing and
Infrastructure Products segment includes Westlake Royal Building Products,
Westlake Pipe & Fittings, Westlake Global Compounds and Westlake Dimex. The
change has been retrospectively reflected in the periods presented in this Form
10-K. We are highly integrated along our materials chain with significant
downstream integration from ethylene and chlor-alkali (chlorine and caustic
soda) into vinyls, polyethylene and styrene monomer. We also have substantial
downstream integration from PVC into our building products, PVC pipes and
fittings and PVC compounds in our Housing and Infrastructure Products segment.


Hexion Global Epoxy Business

On November 24, 2021, Westlake, through one of its wholly-owned subsidiaries,
entered into a Stock Purchase Agreement (the "Hexion Purchase Agreement") by and
among Hexion Inc. ("Hexion"), an Ohio corporation, and, solely for the limited
purposes set forth therein, Westlake. Pursuant to the terms of the Hexion
Purchase Agreement, Westlake agreed to acquire Hexion's global epoxy business
for a purchase price of approximately $1,200 million in cash, subject to certain
closing date adjustments as set forth in the Hexion Purchase Agreement. On
February 1, 2022, we completed the acquisition of Hexion's global epoxy business
(the "Hexion Acquisition"). The assets acquired and liabilities assumed and the
results of operations of Hexion's epoxy business will be included in the
Performance and Essential Materials segment. This acquisition represents a
significant strategic expansion of Westlake's Performance and Essential
Materials businesses into additional high-growth, innovative and
sustainable-oriented applications - such as wind turbine blades and light-weight
automotive structural components. Because epoxies are produced from chlorine and
caustic soda, the transaction also provides vertical integration with our global
chlor-alkali businesses.


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