Kuwait’s Equate Petrochemicals is set to acquire MEGlobal for $3.2bn from the US’ Dow Chemical.

MEGlobal is headquartered in Dubai and produces 1 million tonnes a year (t/d) of ethylene glycol in Canada.

Dow owns a 42.5 per cent stake in Equate, as does Kuwait’s state-owned Petrochemical Industries Company (PIC). Other Kuwaiti holding companies own minority stakes.

Dow will still retain an interest in MEGlobal through its Equate stake. However, it is planning to reduce this stake in mid-2016.

In July 2004, Dow sold a 50 per cent interest in its three Canadian ethylene glycol assets to PIC, and they created MEGlobal.

Dow has also announced the intention to set up an MEGlobal plant on the US’ southeastern coast.

Reuters has reported that Equate has appointed arrangers for a $6bn loan to finance the acquisition. The bridge loan would also refinance existing debt and be used for general corporate purposes.

US-based JP Morgan Chase and Citigroup, UK-based HSBC, and Kuwait Finance House and National Bank of Kuwait are the arrangers, according to UK news agency Reuters.