ABB investing US$100 million in China's Sinopec Corp. IPO

12 September 2000

ABB investing US$100 million in China's Sinopec Corp. IPO; Highlights commitment to world's second-largest economy

    ZURICH, Switzerland--September 12, 2000--ABB, the global technology company, said today it has agreed to invest US$ 100 million in Sinopec Corp., Asia's largest refiner, through an Initial Public Offering (IPO). ABB will be a Strategic Investor in Sinopec Corp.'s IPO, joining several other multinational corporations.
    Sinopec Corp. processes 50 percent of China's domestic crude oil throughput, has the largest product sales and distribution network in China, and is the largest chemicals producer in China with approximately 47 percent of the domestic ethylene capacity in 1999.
    ABB, through its ABB Lummus Global unit, has supplied technology for 62 percent of China's overall ethylene capacity. ABB's relationship with Sinopec dates back to the early 1970s. This relationship has recently intensified through a broad cooperation to develop and market new ethylene technology for application in China and for the international market. This cooperation has already resulted in the sale of jointly-developed cracking heaters - that breakdown petrochemical feedstock into smaller molecules used in a broad range of plastics and other products - which will produce some one million tons of new ethylene capacity in China.
    It is expected that Sinopec Corp. will invest more than US$ 5 billion in areas related to ABB's business capabilities over the next three years.
    Sinopec Corp. Chairman Li Yizhong said, "We welcome the investment and partnership with ABB. Their range of technologies and services in oil, gas and petrochemicals, automation, power transmission and distribution will continue to be of great value to Sinopec Corp." Chairman Li added that, "We believe the cooperation between Sinopec Corp. and ABB will be further strengthened after ABB becomes a Strategic Investor in Sinopec Corp.'s IPO."
    Goran Lindahl, President and CEO of ABB, said, "ABB has for a long time been committed to China. We have some 5,000 people working in the country and more than 20 joint ventures up and running. This investment in Sinopec Corp. matches our global strategy to expand in both regions and technologies where we see good growth potential."
    Sinopec is an integrated petroleum and petrochemical company with upstream, midstream and downstream operations and, based on total operating revenues from its continuing operations of RMB 213.0 billion (US$ 25.7 billion) in 1999, Sinopec is the largest petroleum and petrochemical company in China and one of the largest in Asia.