Lyondell and Millennium Announce Agreement to Combine HOUSTON and
HUNT VALLEY, Md., March 29 /PRNewswire-FirstCall/ -- Lyondell
Chemical Company and Millennium Chemicals Inc. today announced that
their Boards of Directors have approved, and the companies have
executed, a definitive agreement for a stock-for-stock business
combination of the companies, expected to be tax-free to the
shareholders of Millennium and the companies. The transaction will
create North America's third-largest independent, publicly traded
chemical producer with combined pro forma 2003 revenues of more
than $11 billion and market capitalization of nearly $4 billion.
Millennium shareholders will receive between 0.95 and 1.05 shares
of Lyondell common stock for each share of Millennium common stock,
depending on the volume-weighted average price for the Lyondell
shares for the 20 trading days ending on the third trading day
before closing. Millennium shareholders will receive 0.95 shares of
Lyondell stock if the average Lyondell stock price is $20.50 or
greater, and 1.05 if it is $16.50 or less. Between the two prices,
the exchange ratio varies proportionately. The new shares will be
entitled to receive the same cash dividend as existing outstanding
Lyondell shares. Based on recent trading, the transaction is valued
at approximately $2.3 billion including approximately $1.3 billion
of Millennium net debt. The transaction is subject to customary
conditions including approval by both companies' shareholders, and
is expected to close in the third quarter of 2004. After the close
of the transaction, the company will be called "Lyondell Chemical
Company" and will be headquartered in Houston, Texas. Dan F. Smith
will continue as president and chief executive officer, and Dr.
William T. Butler will continue as the independent chairman of the
Lyondell Board of Directors. Two independent members of
Millennium's current Board will join the Lyondell Board, effective
at the time of the closing. The transaction combines two U.S.
chemical companies that are well positioned globally, with leading
positions in propylene oxide and derivatives, titanium dioxide
(TiO2) and acetyls. And, through their Equistar joint venture -- a
major North American producer of ethylene, propylene, polyethylene
and aromatics -- they have significant leverage to the
petrochemical cycle, providing opportunity for the combined
company's shareholders to take full advantage of the recovery in
the petrochemical cycle. The combined company will operate in 16
countries and employ about 10,000 people worldwide. "Since its
creation in 1985, Lyondell has become a leading, global, integrated
chemical company with world-scale assets and proprietary processes
and technology," said Dan F. Smith, Lyondell's president and chief
executive officer. "We have a long history of successfully
combining assets, product lines and corporate cultures to create
one of the world's leading chemical companies. Despite the
prolonged industry trough, Lyondell and Equistar combined finished
2003 with more than $1.3 billion of liquidity. We expect this
transaction to be accretive to Lyondell's earnings per share in
2005. "This is another step in our long-standing strategy to
increase Lyondell's global depth and breadth, and maintains our
leverage to the ethylene cycle, allowing us to use the resulting
cash flow to reduce debt," added Smith. "By integrating
Millennium's operations with Lyondell's and Equistar's, we believe
there is value that can be achieved through the realization of
synergies. We expect to realize at least $50 million in cost
savings from this combination, bringing value to all of the
shareholders." Robert E. Lee, president and chief executive officer
of Millennium, said, "This is the right move at this juncture for
Millennium. The transaction creates compelling value for our
shareholders. We strongly believe that the added diversification
and market leadership brought by the TiO2 and acetyls businesses
will greatly benefit the combined entity. These businesses also
will benefit from being part of a larger global entity." Millennium
is the second-largest producer of TiO2 in the world, in an industry
in which the five largest producers represent approximately 75
percent of worldwide capacity. Millennium has a larger geographic
footprint than any other TiO2 producer, with competitive production
facilities on four continents. The TiO2 business has a strong
technology and customer base. The acetyls business is a significant
ethylene consumer and, as such, integrates very well with
Equistar's petrochemical business. Millennium holds the number-two
North American capacity position for acetyls and is number three in
the world. Millennium utilizes proprietary, advantaged technologyat
its world-scale manufacturing facility in La Porte, Texas. "After
the closing of the transaction, Lyondell will appear much less
complicated to our investors with its consolidated petrochemicals,
polymers and intermediate chemicals businesses. In the new
organization, however, Lyondell, Equistar and Millennium will each
remain separate entities and keep their separate debt structures,"
Smith said. The transaction involves the merger of a newly created
subsidiary of Millennium into Millennium, inwhich the Millennium
common stock now held by its public shareholders will be converted
into common stock of Lyondell, and the Millennium preferred stock
to be issued to Lyondell immediately before the merger will be
converted into common stock of the surviving entity. As a result,
Millennium will become a wholly owned subsidiary of Lyondell.
Following the transaction, the Millennium convertible debentures
will become convertible into Lyondell common stock in accordance
with the terms of the convertible debenture indenture. Citigroup
Global Markets Inc. acted as financial advisor and provided a
fairness opinion to Lyondell. J.P. Morgan Securities Inc. acted as
principal financial advisor to Millennium, and along with UBS
Investment Bank, each has provided a fairness opinion to
Millennium. Baker Botts L.L.P. is legal counsel to Lyondell, and
Weil, Gotshal & Manges LLP is legal counsel to Millennium.
Lyondell, headquartered in Houston, Texas, is a leading producer
of: propylene oxide (PO); PO derivatives including propylene glycol
(PG), butanediol (BDO) and propylene glycol ethers (PGE); and
styrene monomer and MTBE as co-products of PO production. Through
its current 70.5 percent interest in Equistar Chemicals, LP,
Lyondell also is one of the largest producers of ethylene,
propylene and polyethylene in North America and a leading producer
of ethylene oxide, ethylene glycol, high value-added specialty
polymers and polymeric powder. Through its 58.75 percent interest
in LYONDELL-CITGO Refining LP, Lyondell is one of the largest
refiners in the United States processing extra heavy Venezuelan
crude oil to produce gasoline, low sulfur diesel and jet fuel.
Millennium is the second-largest producer of TiO2 in the world, the
largest merchant seller of titanium tetrachloride and a major
producer of zircon and zirconia, silica gel and cadmium-based
pigments. It also is the second-largest producer of acetic acid and
vinyl acetate monomer in North America, and a leading producer of
terpene-based fragrance and flavor chemicals. Millennium currently
has a 29.5 percent interest in Equistar. Today, March 29, at 12:00
noon, Eastern Time, Lyondell and Millennium will host a conference
call and webcast to discuss this announcement. Access information
is as follows: Dial-in access: U.S. Toll Free: 888-391-2385
International: 484-644-0641 Please call 10 to 15 minutes before the
scheduled start of the teleconference. Pass code: Lyondell Webcast:
Will be available at 12:00 noon Eastern Time on March 29 at
http://www.lyondell.com/ and http://www.millenniumchem.com/.
Replay: Webcast replay will be available from 3:00 p.m. Eastern
Time March 29, 2004 to 5:00 p.m. Eastern Time March 29, 2005 at
http://www.lyondell.com/ and http://www.millenniumchem.com/.
Telephone replay will be available through April 12, 2004 at
800-839-2235 (U.S.) or 402-998-1082 (international). The passcode
is 5549. Related Reconciliations of non-GAAP financial measuresto
Disclosures: GAAP financial measures and any other applicable
disclosures (including the news release) will be available at 12:00
noon Eastern Time on March 29 at http://www.lyondell.com/ and
http://www.millenniumchem.com/. Table 1: Lyondell and Equistar
Liquidity at December 31, 2003 (Millions of dollars) Lyondell
Equistar Cash and cash equivalents $438 $199 Facilities
availability 300 430 Total liquidity $738 $629 Table 2: Millennium
Net Debt at December 31, 2003 (Millions of dollars) Long-term debt
$1,461 Current maturities of long-term debt 6 Less: Cash and cash
equivalents (209) Net debt $1,258 This release contains
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Such statements include,
but are not limited to, statements about the benefits of the
proposed transaction between Lyondell Chemical Company ("Lyondell")
and MillenniumChemicals Inc. ("Millennium"), including financial
and operating results, the parties' plans, objectives, expectations
and intentions and other statements that are not historical facts.
Such statements are based upon the current beliefs and expectations
of Lyondell's and Millennium's respective managements and are
subject to significant risks and uncertainties. Actual results may
differ materially from those set forth in the forward-looking
statements. The following factors, among others, could affect the
proposed transaction and the anticipated results: approval by
Lyondell's and Millennium's respective shareholders, amendments to
Lyondell's and Millennium's respective credit facilities, the
expiration or termination of any applicable waiting period under
the Hart-Scott-Rodino Act, the receipt of other competition law
clearances and the parties' ability to achieve expected synergies
in the transaction within the expected timeframes or at all.
Additional factors that could cause Lyondell's results to differ
materially from those described in the forward-looking statements
can be found in Lyondell's Annual Report on Form 10-K for the year
ended December 31, 2003, which was filed with the Securities and
Exchange Commission (the "SEC") on March 12, 2004. Additional
factors that could cause Millennium's results to differ materially
from those described in the forward-looking statements can be found
in Exhibit 99.1 to Millennium's Annual Report on Form 10-K for the
year ended December 31, 2003, which was filed with the SEC on March
12, 2004 (the "Millennium 10-K"). Lyondell and Millennium will file
a joint proxy statement/prospectus with the SEC in connection with
the proposed transaction. Investors and security holders are urged
to read that document, when it becomes available, because it will
contain important information. Investors and security holders may
obtain a free copy of that document (when it becomes available) and
other documents filed by Lyondell and Millennium with the SEC at
the SEC's web site at http://www.sec.gov/. The joint proxy
statement/prospectus (when it becomes available) and the other
documents filed by Lyondell may also be obtained free from Lyondell
by calling Lyondell's Investor Relations department at (713)
309-4590 and may be obtained free from Millennium by calling
Millennium's Investor Relations department at (410) 229-8113. The
respective executive officers and directors of Lyondell and
Millennium and other persons may be deemed to be participantsin the
solicitation of proxies in respect of the proposed transaction.
Information regarding Lyondell's executive officers and directors
is available in its proxy statement filed with the SEC by Lyondell
on March 16, 2004, and information regarding Millennium's directors
and its executive officers is available in the Millennium 10-K.
Other information regarding the participants in the proxy
solicitation and a description of their direct and indirect
interests, by security holdings or otherwise, will be contained in
the joint proxy statement/prospectus and other relevant materials
to be filed with the SEC.
==========================================================================
Attachment 1: Capacities and Major Positions Lyondell Intermediate
Chemicals & Derivatives Capacities Major Capacity Positions
Major Products Rated Capacity Global N. America (Million lb./yr.)
Propylene Oxide (PO) 4,500 1 1 Styrene Monomer (SM) 5,000 4 1 MTBE
(bbl/day) 58,500 1 1 Propylene Glycol (PG) & 1,260 2 2
Propylene Glycol Ethers (PGE) Toluene Diisocyanate (TDI) 574 3 4
Butanediol (BDO) 395 2 4 Equistar Capacities Major Capacity
Positions Major Products Rated Capacity Global N. America (Million
lb./yr.) Ethylene 11,600 52 Propylene 5,000 7 2 Butadiene 1,200 3 1
Benzene (million gal/yr) 310 3 Ethylene Glycol (EG) 1,000 3
Ethylene Oxide (EO) 1,100 3 Polyethylene High-density 3,200 3
Polyethylene (HDPE) Low-density 1,400 3 Polyethylene (LDPE) Linear
Low-density 1,100 4 Polyethylene (LLDPE) Millennium Capacities
Major Products Rated Capacity Percentage of Capacity TiO2 Chloride
(metric tons/yr) 515,000 77% Sulfate (metric tons/yr) 155,000 23%
Acetyls Vinyl Acetate Monomer (VAM) 850 (million lb/yr) Acetic Acid
(million lb/yr) 1,200
==========================================================================
Attachment 2: Principal Products Lyondell Intermediate Chemicals
& Derivatives Principal Products Product Annual Capacity
Primary Uses Propylene Oxide (PO) 4.5 billion pounds(a) PO is a key
component of polyols, PG, PGE and BDO. Propylene Glycol(PG) 960
million pounds PG is used to produce unsaturated polyester resins
for bathroom fixtures and boathulls; lower toxicity antifreeze,
coolants and aircraft deicers; and cosmetics and cleaners.
Propylene Glycol 300 million pounds PGE are used as lower toxicity
Ethers (PGE) solvents for paints, coatings and cleaners. Butanediol
(BDO) 395 million pounds BDO is used in the manufacture of
engineering resins, films, personal care products, pharmaceuticals,
coatings, solvents and adhesives. Toluene Diisocyanate 574 million
pounds(b) TDI is combined with polyols (TDI) to produce flexible
foam for automotive seating and home furnishings. Styrene Monomer
(SM) 5.0 billion pounds(c) SM is used to produce plastics, such as
expandable polystyrene for packaging, foam cups and containers,
insulation products and durables and engineering resins. Methyl
Tertiary 897 million gallons MTBE is a gasoline component Butyl
Ether (MTBE) (58,500 barrels/day) for reducing emissions in
reformulated gasolines and enhancing octane value. (a) Includes:
100% of the 385 million pounds of capacity of Nihon Oxirane, a
joint venture of which the Company owns 40%; approximately 1.6
billion pounds of capacity that represents Bayer's share of PO
production from the Channelview PO/SM I plant and the Bayport,
Texas PO/TBA plants under the U.S. PO Joint Venture; and 100% of
the 625 million pounds of capacity of the Maasvlakte PO/SM plant,
which began production during the fourth quarter of 2003 and is
owned by the European PO Joint Venture with Bayer, as to which the
company has the right to 50% of the production. (b) Includes:
approximately274 million pounds of average annual TDI capacity at
Lyondell's plant in Pont de Claix, France, which is operated by
Rhodia. (c) Includes: approximately 1.1 billion pounds of SM
production from the Channelview PO/SM II plant that is committed to
unrelated equity investors under long-term processing agreements;
100% of the 830 million pounds of capacity of Nihon Oxirane, of
which the Company owns 40%; and 100% of the 1.4 billion pounds of
capacity of the Maasvlakte PO/SM plant, which began production
during the fourth quarter of 2003 and is owned by the European PO
Joint Venture with Bayer, as to which the Company has the right to
50% of the production. Equistar Principal Products Product Annual
Capacity Primary Uses OLEFINS Ethylene 11.6 billion pounds(a)
Ethylene is used as a raw material to manufacture polyethylene, EO,
ethanol, ethylene dichloride and ethylbenzene. Propylene 5 billion
pounds(a)(b) Propylene is used to produce polypropylene,
acrylonitrile and propylene oxide. Butadiene 1.2 billion pounds
Butadiene is used to manufacture styrene- butadiene rubber and
polybutadiene rubber, which are used in the manufacture of tires,
hoses, gaskets and other rubber products. Butadiene is also used in
the production of paints, adhesives, nylon clothing, carpets, paper
coatings and engineered plastics. OXYGENATED PRODUCTS Ethylene
Oxide(EO) 1.1 billion pounds EO EO is used to produce equivalents;
400 surfactants, industrial million pounds as cleaners,cosmetics,
pure EO (c) emulsifiers, paint, heat transfer fluids and ethylene
glycol. Ethylene Glycol(EG) 1 billion pounds(c) EG is used to
produce polyester fibers and film, polyethylene terephthalate
("PET")resin, heat transfer fluids and automobile antifreeze.
Ethylene Oxide 225 million pounds EO derivatives include
Derivatives ethylene glycol ethers and ethanolamines, and are used
to produce paint and coatings, polishes, solvents and chemical
intermediates. Ethanol 50 million gallons Ethanol is used in the
production of solvents as well as household, medicinal and personal
care products. MTBE 284 million gallons MTBE is a gasoline
component (18,500 barrels/day)(d) for reducing emissions in
reformulated gasolines and enhancing octane value. AROMATICS
Benzene 310 million gallons Benzene is used to produce styrene,
phenol and cyclohexane. These products are used in the production
of nylon, plastics, synthetic rubber and polystyrene. Polystyrene
is used in insulation, packaging and drink cups. Toluene 66 million
gallons Toluene is used as an octane enhancer in gasoline, as a
chemical raw material benzene and/or paraxylene production, and a
core ingredient in TDI, a compound used in urethane production.
SPECIALTY PRODUCTS Dicyclopentadiene 130 million pounds DCPD is a
component of inks, (DCPD) adhesives and polyester resins for molded
parts such as tub and shower stalls and boat hulls. Isoprene 145
million pounds Isoprene is a component of premium tires, adhesive
sealants and other rubber products. Resin Oil 150 million pounds
Resin oil is used in the production of hot-melt adhesives, inks,
sealants, paints and varnishes. Piperylenes 100 million pounds
Piperylenes are used in the production of adhesives, inks and
sealants. Alkylate 337 million gallons(e) Alkylate is a premium
gasoline blending component used by refiners to meet Clean Air Act
standards for reformulated gasoline. POLYETHYLENE High Density 3.2
billion pounds HDPE is used to manufacture Polyethylene grocery,
merchandise & trash (HDPE) bags; food containers for items from
frozen desserts to margarine; plastic caps & closures; liners
for boxes of cereal & crackers; plastic drink cups & toys;
dairy crates; bread trays; pails for items from paint to fresh
fruits & vegetables; safety equipment such as hard hats; house
wrap for insulation; bottles for household & industrial
chemicals & motor oil; milk, water, and juice bottles; and
large (rotomolded) tanks for storing liquids such as agricultural
and lawn care chemicals. Low Density 1.4 billion pounds LDPE is
used to manufacture Polyethylene food packaging films; (LDPE)
plastic bottles for packaging food and personal care items; dry
cleaning bags; ice bags; pallet shrink wrap; heavy- duty bags for
mulch and potting soil; boil-in-bag bags; coatings on flexible
packaging products; and coatings on paper board such as milk
cartons. Ethylene vinyl acetate is a specialized form of LDPE used
in foamed sheets, bag-in-box bags, vacuum cleaner hoses, medical
tubing, clear sheet protectors and flexible binders. Linear Low 1.1
billion pounds LLDPE is used to manufacture Density garbage and
lawn-leaf bags; Polyethylene industrial can liners; (LLDPE)
housewares; lids for coffee cans and margarine tubs, dishpans, home
plastic storage containers, kitchen trash containers; large
(rotomolded) toys like outdoor gym sets; drip irrigation tubing;
protective coating for telephone wires and film; shrink wrap for
multi- packaging canned food, bag- in-box bags, produce bags, and
pallet stretchwrap. POLYPROPYLENE Polypropylene 280 million pounds
Polypropylene is used to manufacture fibers for carpets, rugs and
upholstery; housewares; automotive battery cases; automotive
fascia, running boards andbumpers; grid-type flooring for sports
facilities; fishing tackle boxes; and bottle caps and closures.
PERFORMANCE POLYMERS Wire and Cable (f) Wire and cable insulating
Insulating Resins resins and compounds are used and Compounds to
insulate copper and fiber optic wiring in power, telecommunication,
computer and automobile applications. Polymeric Powders (f)
Polymeric powders are component products in structural and bulk
molding compounds, parting agents and filters for appliance,
automotive and plastics processing industries. Polymers for (f)
Polymers are components in Adhesives, Sealants hot-melt-adhesive
and Coatings formulations forcase, carton and beverage package
sealing, glue sticks, automotive sealants, carpet backing and
adhesive labels. Reactive Polyolefins (f) Reactive polyolefins are
functionalized polymers used to bond non-polar and polar substrates
in barrier food packaging, wire and cable insulation and jacketing,
automotive gas tanks and metal coating applications. (a) Includes
850 million pounds/year of ethylene capacity and 200 million
pounds/year of propylene capacity atEquistar's Lake Charles,
Louisiana facility. Equistar's Lake Charles facility has been idled
since the first quarter of 2001, pending sustained improvement in
market conditions. (b) Does not include refinery-grade material or
production from the product flexibility unit at Equistar's
Channelview facility, which can convert ethylene and other light
petrochemicals into propylene. This facility has an annual
processing capacity of one billion pounds per yearof propylene. (c)
Includes 350 million pounds/year of EO equivalents capacity and 400
million pounds/year of EG capacity at the Beaumont, Texas facility,
which represents Equistar's 50% of the total EO equivalents
capacity and EG capacity, respectively, at the facility. The
Beaumont, Texas facility is owned by PD Glycol, a partnership owned
50% by Equistar and 50% by DuPont. (d) Includes up to 44 million
gallons/year of capacity processed by Equistar for LCR and returned
to LCR. (e) Includes up to 172 million gallons/year of capacity
processed by Equistar for LCR and returned to LCR. (f) These are
enhanced grades of polyethylene and are included in the capacity
figures for HDPE, LDPE and LLDPE above, as appropriate. Millennium
Principal Products Product Primary Uses TITANIUM DIOXIDE AND
RELATED PRODUCTS Titanium Dioxide (TiO2) A white pigment used to
provide whiteness, brightness, opacity and durability in paint and
coatings, plastics, paper and elastomers. Titanium Tetrachloride
(TiCl4) The intermediate product used in making TiO2. TiCl4 is also
used for: the manufacture of titanium metal, which is used to make
a wide variety of products including eyeglass frames, aerospace
parts and golf clubs, the manufacture of catalyst and specialty
pigments; and as a surface treatment for glass. Zirconium-based
compounds and Chemicals used in coloring for chemicals ceramics, in
pigment surface treatment, solid oxide fuel cells and to enhance
optics. Ultra-fine TiO2 Nanoparticle and ultra-fine products used
in optical, electronic, catalyst and ultra-violet absorption
application. Silica gel Inorganic product used to reduce gloss and
control flow in coatings. Also used to stabilize beer and extend
the shelf life of plastic films, powdered food products and
pharmaceuticals. Cadmium-based pigments Inorganic colors used in
engineered plastics, artists' colors, ceramics, inks, automotive
refinish coatings, coil and extrusion coatings, aerospace coatings
and specialty industrial finishes. Zircon Sand (Zircon) A coarse
fine white mineral powder used in refractory material, ceramic
material and foundry sand. ACETYLS Vinyl acetate monomer A
petrochemical product used to produce a variety of polymers
products used in adhesives, water-based paint, textile coatings and
paper coatings. Acetic Acid A feedstock used to produce vinyl
acetate monomer, terephthalic acid (used to produce polyester for
textiles and plastics bottles), industrial solvents, and a variety
of other chemicals. Methanol A feedstock used to produce acetic
acid; methyl tertiary butyl ether (MTBE), a gasoline additive;
formaldehyde; and several other products. The Company is a producer
of methanol through its 85% interest in La Porte Methanol Company.
SPECIALTY CHEMICALS Terpene fragrance chemicals Individual
components that are blended to make fragrances used in detergents,
soaps, perfumes, personal-care items and household goods. Flavor
chemicals Individual components that are blended to impart or
enhance flavors used in toothpaste, chewing gum and other consumer
products.
==========================================================================
Attachment 3: Manufacturing Locations Lyondell Intermediate
Chemicals & Derivatives Manufacturing Locations Locations
Principal Products Bayport (Pasadena), Texas (a)* PO, PG, PGE, TBA
Channelview, Texas (a) (b)* PO, BDO, SM, MTBE Lake Charles,
Louisiana * TDI Fos-sur-Mer, France (c) PO, PG, TBA, MTBE Pont de
Claix, France (d) TDI Botlek, Rotterdam, The Netherlands (c) PO,
PG, PGE, TBA, MTBE, BDO Maasvlakte (near Rotterdam), The PO, SM
Netherlands (e) Chiba, Japan (f) PO, SM * The portions of the
facility owned by Lyondell are mortgaged as collateral for
Lyondell's credit facility, senior secured notes and debentures.
(a) The Bayport PO/TBA plants and the Channelview PO/SM I plant are
held by the U.S. PO Joint Venture between Bayer and the Company.
(b) Unrelated equity investors hold a minority ownership interest
in the PO/SM II plant at Lyondell's Channelview facility. (c) The
land is leased. (d) The land is leased by Rhodia and certain assets
are owned by the Company. (e) The land is leased. The Maasvlakte
PO/SM plant is held by the European PO Joint Venture between Bayer
and the Company. (f) The PO/SM plant located in Chiba, Japan, is
owned by Nihon Oxirane, a joint venture of which the Company owns a
40 percent interest. Equistar Manufacturing Locations Locations
Principal Products Beaumont, Texas (a) * EG Channelview, Texas (b)
* Ethylene, Propylene, Butadiene, Benzene, Toluene, DCPD, Isoprene,
Resin Oil, Piperylenes, Alkylate and MTBE Corpus Christi, Texas *
Ethylene, Propylene, Butadiene and Benzene Chocolate Bayou, Texas
(c) HDPE Chocolate Bayou, Texas (c)(d) * Ethylene, Propylene,
Butadiene, Benzene, Toluene, DCPD, Isoprene, Resin Oil and MTBE
LaPorte (Deer Park), Texas (e)* Ethylene, Propylene, LDPE, LLDPE,
Wire and Cable Insulating Resins, and Polymers for Adhesives,
Sealants and Coatings. Matagorda, Texas * HDPE Bayport (Pasadena),
Texas * EO, EG and Other EO Derivatives Bayport (Pasadena), Texas
(f)* LDPE Victoria, Texas (d)* HDPE Lake Charles, Louisiana (g)*
Ethylene and Propylene Morris, Illinois* Ethylene, Propylene, LDPE,
LLDPE and Polypropylene Tuscola, Illinois * Ethanol and Polymeric
Powders Clinton, Iowa * Ethylene, Propylene, LDPE, HDPE and
Reactive Polyolefins Fairport Harbor, Ohio (h) Wire and Cable
Insulating Compounds Newark, New Jersey Denatured Alcohol * As of
January 1, 2004, facilities which received the OSHA Star
Certification, which is the highest safety designation issued by
the U.S. Department of Labor. (a) The Beaumont facility is owned by
PD Glycol, a partnership owned 50% by Equistar and 50% by DuPont.
(b) The Channelview facility has two ethylene processing units.
Lyondell owns a methanol plant located within the Channelview
facility on property Lyondell leases from Equistar. This methanol
plant is being operated for Lyondell by Equistar on behalf of an
unrelated party. Another unrelated party owns and operates a
facility on land leased from Equistar that is used to purify
hydrogen from Lyondell's methanol plant. Equistar also operates a
styrene maleic anhydride unit and a polybutadiene unit, which are
owned by a third party and are located on property leased from
Equistar within the Channelview facility. (c) Millennium and
Occidental each contributed a facility located in Chocolate Bayou.
These facilities are not on contiguous property. (d) The land is
leased. (e) Equistar intends to temporarily consolidate its
automotive compound production at the Fairport Harbor, Ohio
facility and temporarily idle the automotive compound production
unit at the LaPorte, Texas facility at the end of the first quarter
of 2004. (f) The facility is located on land leased from Sunoco.
The facility is operated by Sunoco for Equistar. (g) The Lake
Charles facility has been idled since the first quarter of 2001,
pending sustained improvement in market conditions. The facilities
and land are leased from Occidental Chemical Corporation, a
subsidiary of Occidental, under a lease that expires in May 2004
and has renewal provisions for two additional one-year periods at
either party's option. (h) The building and land are leased.
Millennium Manufacturing Locations Locations Principal Products
TITANIUM DIOXIDE & RELATED PRODUCTS Ashtabula, Ohio * TiO2 and
TiCl4 Baltimore, Maryland (Hawkins Point)* TiO2 Baltimore, Maryland
(St. Helena) Cadmium-based pigments and silica gel Kemerton,
Western Australia TiO2 Le Havre, France TiO2 Mataraca, Paraiba,
Brazil ** Ilmenite (generally consumed in the Salvador TiO2 plant),
zircon and natural rutile titanium ore Rockingham, Western
Australia Zirconium-based compounds and chemicals Salvador, Bahia,
Brazil ** TiO2 Stallingborough, United Kingdom TiO2 Thann, France
TiO2 and TiCl4 and ultra- fine TiO2 ACETYLS La Porte, Texas VAM and
acetic acid SPECIALTY CHEMICALS Brunswick, Georgia Fragrance and
flavor chemicals Jacksonville, Florida Fragrance and flavor
chemicals * The Company has two manufacturing plants at Ashtabula,
Ohio, both of which use the chloride process, and two manufacturing
plants located in Baltimore, Maryland (Hawkins Point), one of which
uses the chloride process for manufacturing TiO2 and the other of
which used the sulfate process but is currently idle. **
Third-party equity investors hold a minority ownership interest in
Millennium Brasil, which owns this facility. DATASOURCE: Lyondell
Chemical Company; Millennium Chemicals Inc. CONTACT: Investors -
Doug Pike, +1-713-309-7141, or Media - Susan Moore,
+1-713-652-4645, both of Lyondell Chemical Company; or Investors -
Tom Van Valkenburgh, +1-410-229-8113, or Media - Amy Drusano,
+1-410-229-8062, both of Millennium Chemicals Inc. Web site:
http://www.lyondell.com/ http://www.millenniumchem.com/
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