Interview with Andy Verheijden, Piotr Kwiecień and Boy Litjens from SABIC

SABIC is the Saudi Basic Industries Corporation, one of the world`s leading manufacturers of chemicals, fertilizers, plastics and metals. The company supplies these materials to other companies, who use them to make the products on which the world has come to depend. SABIC Innovative Plastics, launched in 2007, is a leading, global supplier of engineering thermoplastics with a 75-year history of breakthrough solutions that solve its customers` most pressing challenges.
We publish the interview with Andy Verheijden (Growth Leader for Eastern Europe at SABIC Innovative Plastics, formerly GE Plastics), Piotr Kwiecień (Office Captain of SABIC Poland), and Boy Litjens (Chief Executive Officer and Chairman of the Managing Board of SABIC Europe).

Andy Verheijden (Growth Leader for Eastern Europe at SABIC Innovative Plastics

Last year General Electric Plastics Company was sold to SABIC. Can we talk, after one year, about benefits (or disadvantages) of the transaction? If we can, discuss please the most important benefits.

Andy Verheijden: - SABIC Innovative Plastics with its European Headquarters in Bergen op Zoom is the most recent addition to SABIC`s global family of businesses. SABIC Innovative Plastics was launched last year following the acquisition of General Electric Plastics in 2007 and is a leading global supplier of engineering thermoplastic widely used in automotive, electronics, building & construction, transportation, and healthcare.

The company manufactures and compounds a great number of advanced materials solutions under such well known brand names as Lexan*, Noryl*, Valox*, and Ultem*.

The dedicated SABIC Innovative Plastics automotive organization is an experienced supplier, offering its high-end plastics solutions to key automotive segments.

The acquisition by SABIC brings a great many advantages:

• SABIC Innovative Plastics is a critical new strategic business unit within SABIC and we play an important role in SABIC`s mission to become a larger and more diversified specialty company and a bigger global player.
• Together with SABIC Europe, we are a powerful presence in the industry in Europe.
• We are now part of one of the world`s largest and most profitable petrochemical manufactures with significant financial and research resources to be a long term player in the industry.

SABIC Innovative Plastics is a well known company around the world. It is obvious. What does distinguish your company from the rest of competitors?

SABIC Innovative Plastics provides a total solutions approach to the needs of our customers from materials selection to technology, design and application testing support. We`ve organized ourselves around our customers and our solutions, with dedicated sales and development teams and a large marketing team for the specialized side of our business - Automotive and Specialty Film and Sheet. We have a large portfolio to serve key industry segments, with continued new innovations to serve the changing needs of our customers - such as Extem* resin (high heat), Geloy* XTW resin (weatherability) and Lexan* resin co-polymer technologies with advanced material properties.

When we look at the combined strength of the SABIC family, the company brings the broadest portfolio of solutions for the customers. For example if we look at automotive, SABIC Europe and SABIC Innovative Plastics combined offer unsurpassed bumper-to-bumper plastic solutions to the European automotive industry.

SABIC Europe is also the market leader in bumpers and long glass fiber technology in Europe and has consistently provided tailor-made solutions to top OEM and Tier automotive partners for almost 30 years, manufacturing a wide range of PP compounds which are used in an array of automotive applications for interiors, exteriors, and under the hood.

We are in Poland. International Fair of Plastics Processing Plastpol is the largest exhibition not only in Poland but also in Central Europe. Tell me please how important to SABIC is the polish market and whole Central European market.

Andy Verheijden: - We are at Plastpol as "one" SABIC for the first time- SABIC Europe and SABIC Innovative Plastics. Our presence at this event confirms the importance of the Polish market in SABIC`s Emerging Markets strategy. Major Polish markets into which SABIC materials are sold include automotive, electrical and lighting, pipe and infrastructure, and film. SABIC offers Polish customers a strong local team, local supply of materials, and the extensive resources of its Global Application Technology (GApT) centers to support in-country application development.

Piotr Kwiecień: - I would like also to say that SABIC has a long-term growth strategy for Central and Eastern Europe, where growth in SABIC`s polyolefins in the coming years is predicted to be more than 15%. Therefore our presence at Plastpol will allow us to position SABIC more strongly in the local market and build more direct relationships with customers in this region.

Piotr Kwiecień, Office Captain of SABIC Poland

Andy Verheijden: - For SABIC Innovative Plastics, we've seen significant growth in the first quarter this year and we anticipate a 15% growth rate for our high performance solutions in this region. In particular, we have exciting opportunities in the electrical and lighting industry, and the emerging building and construction sector.

We continue to invest in dedicated local resources to assist Polish customers to effectively compete with design, application development and processing optimization using our comprehensive portfolio of innovative materials.

Piotr Kwiecień: - The Polish polyolefins market is the largest market in Central and Eastern Europe. SABIC is looking to grow even faster than the local market, helped by the import of extra volumes of LDPE, LLDPE and PP from plants coming on-stream in the UK and Saudi Arabia in the very near future.

Could you give some examples of SABIC Innovative Plastics activity in Poland?

Andy Verheijden: - A good example is cooperation with Gamrat. SABIC Innovative Plastics helps Gamrat offer durable, recyclable rain gutters in a rainbow of colors. By working with SABIC Innovative Plastics to develop a co-extruded system featuring a cap of custom colored Geloy* XTW (extreme weatherability) resin, Gamrat can now offer the market new aesthetic options while being confident its gutters will retain their good looks and outstanding performance over the long term. because Geloy XTW resin is perfectly compatible with PVC, recycling of the co-extrusion can be done without having to separate the layers. And since no lamination is needed to provide beautiful color, Gamrat avoids the troublesome issue of recycling complications at the end-of-life stage of the rain gutters.

Lets talk about the future. How do you imagine SABIC Europe in ten years. It is a question about the plans and strategy of your further development. -

Boy Litjens: - SABIC`s global vision is to be the preferred world leader in chemicals. Our growth strategy is based on getting even closer to our customers, on continuous innovation based on the skill and ingenuity of our people.

SABIC`s ongoing commitment to growth in Europe means that we are also investing for the future in processes and infrastructure that improve security of supply as well as helping our customers maximize both the physical properties and the productivity from our materials. Looking specifically at SABIC Europe, our growth strategy is based on three key pillars.

Could you enumerate those pillars?

Growth - SABIC Europe is determined to grow market share in Europe, especially in Central and Eastern Europe
Cost leadership - SABIC Europe will produce and sell at the most optimized costs by striving for backward integration especially in olefins, and optimal cost control over our basic processes
Product portfolio extension: - SABIC Europe intends to further broaden its product assortment related to our cracker-activities

Boy Litjens, Chief Executive Officer and Chairman of the Managing Board of SABIC Europe

Let`s take one example - that of pipe. In order to meet the demands of the fast-growing East-European and Russian bimodal pipe markets, we are expanding our global production capacity of bi-modal HDPE for pressure pipes (PE 80/PE 100).

In Europe, SABIC`s new bimodal HDPE plant in Gelsenkirchen, due to come on stream in 2008, will have an annual capacity of 250 kton and will produce material for HDPE pipes for drinking water, gas, sewers and drainage systems.

With new bimodal HDPE capacity also coming onstream from Saudi Arabia in the new future, SABIC will be a leading player in the global pressure pipe market by 2012.

In addition to bi-modal HDPE, SABIC will be increasing its capacities of other polyolefins products in the coming years, both in the Middle East and Europe, ensuring that we fully meet our customers` expectations.

You are going to also start a new plant of LDPE.

Piotr Kwiecień: - That`s true. SABIC`s new European high-pressure LDPE plant on Teesside (UK) is due to come on stream in 2008. This additional capacity opens up exciting possibilities for innovative Medium Density (MD) materials for the future.

What are the most important advantages of the MD-LDPE?

MD-LDPE grades offer converters several advantages over standard LDPE. These benefits include excellent machinability, cutting and punching performance downgauging potential which are all factors that can contribute to lower costs and better line efficiency. Medium density materials also exhibit improved optical properties and greater purity (lower extractable levels and gel level), both of which are increasingly important in the food and beverage industry.

What are the most popular application areas of MD-LDPE?

Overwrap for tissues, printed films for beverage packaging, industrial labels and diapers films can all be improved by the use of MD-LDPE materials. SABIC will launch its new range with three grades, one specifically developed for each key sector - soft hygiene products, consumer packaging, and industrial applications.

Through investments in production and in innovation, SABIC will soon be able to offer customers a broader range of solutions based on high quality materials across the density spectrum, along with the convenience of a single source.

There are two interpenetrating factors: market needs and activity of every strong company. My question is: does market demands influence on your activity, or it is quite another situation, namely do you create market demands? Which factor is stronger?

Andy Verheijden: - Really, it is a combination of both?.as market trends change, we need to be there with the right solution. Alternatively, new technologies can create breakthrough solutions that trigger product improvements that were not thought about before, or perhaps were not affordable. It is difficult to say which is the stronger of the two as it often depends on the applications and the market segment.
Thank you very much for the interview