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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (D) OF
THE SECURITIES EXCHANGE ACT 0F 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED), FEBRUARY 12, 1999
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STERLING CHEMICALS HOLDINGS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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<S> <C> <C>
DELAWARE 1-00059 76-0185186
(STATE OR OTHER JURISDICTION OF (COMMISSION FILE NUMBER) (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
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1200 SMITH STREET, SUITE 1900
HOUSTON, TEXAS 77002-4312
(713) 650-3700
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES AND ZIP CODE)
(713) 650-3700
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
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STERLING CHEMICALS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C> <C>
DELAWARE 333-04343-01 76-0502785
(STATE OF OTHER JURISDICTION OF (COMMISSION FILE NUMBER) (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
</TABLE>
1200 SMITH STREET, SUITE 1900
HOUSTON, TEXAS 77002-4312
(713) 650-3700
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES AND ZIP CODE)
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(713) 650-3700
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
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ITEM 5. OTHER EVENTS
The press releases issued by Sterling Chemicals Holdings, Inc. on
February 12, 1999, February 25, 1999 and March 3, 1999 are filed as Exhibits
99.1, 99.2 and 99.3, respectively, to this Current Report on Form 8-K, and the
contents of such Exhibits are incorporated herein by reference.
ITEM 7. EXHIBITS
The following exhibits are filed as part of this Form 8-K.
Exhibit 99.1 -- Press Release dated February 12, 1999.
Exhibit 99.2 -- Press Release dated February 25, 1999.
Exhibit 99.3 -- Press Release dated March 3, 1999.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrants have duly caused this report to be signed on their behalf by the
undersigned hereunto duly authorized.
STERLING CHEMICALS HOLDINGS, INC.
STERLING CHEMICALS, INC.
(Registrants)
Date: March 4, 1999
By: /s/ Gary M. Spitz
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Gary M. Spitz
Vice President-Finance and
Chief Financial Officer
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INDEX TO EXHIBITS
EXHIBIT
NUMBER DESCRIPTION
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99.1 Press Release dated February 12, 1999.
99.2 Press Release dated February 25, 1999.
99.3 Press Release dated March 3, 1999.
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EXHIBIT 99.1
STERLING CHEMICALS AND BP AMOCO ANNOUNCE ACETIC ACID EXPANSION
Houston, Texas February 12, 1999 . . .Sterling Chemicals, Inc. and BP
Amoco Plc. today announced plans to expand the world-scale acetic acid plant at
Sterling's Texas City, Texas petrochemical facility. Sterling and BP Amoco
expect to complete the project by the end of March 1999, which will increase
Sterling's annual acetic acid production capacity by approximately 25% to about
1 billion pounds.
The expansion project will include minor hardware modifications but will
take advantage of the most recent technology and process developments afforded
by BP Amoco's highly efficient state-of- the-art Cativa(TM) technology.
Implementation of the Cativa(TM) technology coupled with advanced operating
expertise is expected to upgrade Sterling's plant to one of the most cost
competitive acetic acid facilities in the world.
Sterling is a major U.S. producer of acetic acid, with about 18% of
domestic capacity after the expansion. BP Amoco is the world's largest merchant
marketer of acetic acid and markets all of Sterling's acetic acid production
under a long-term agreement. BP Amoco is providing the Cativa(TM) technology
and a portion of the capital for the $10 million expansion. About 70% of the
world's manufacturing capacity for acetic acid uses BP technology.
Peter De Leeuw, President and Chief Executive Officer of Sterling
stated, "The expansion of Sterling's acetic acid facility demonstrates the
strength of the Sterling/BP Amoco relationship in acetyls, which has been
ongoing since 1986." Mr. De Leeuw went on to say "This new effort expresses our
continuing commitment to the marketplace and provides additional evidence that
Sterling is becoming a cost leader in the commodity chemical industry."
Iain Macdonald, Chief Executive Acetyls Business Unit, BP Amoco, said,
"BP Amoco is pleased to participate in this project which continues our
commitment to the Texas City site and the relationship with Sterling Chemicals.
The acetic acid unit will provide secure, cost advantaged product for our
growing global acetic acid requirements. BP Amoco's worldwide production of
acetic acid will shortly exceed 4 billion pounds per year."
BP and Amoco recently completed the largest industrial merger in
history. The merger combines Amoco's market strength in PTA, paraxylene, poly
alpha-olefins and polybutene and BP's strength in acetic acid, acrylonitrile,
oxygenated solvents, and polyethylene.
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Based in Houston, Texas, Sterling Chemicals Holdings, Inc. is a holding
company that, through its operating subsidiaries, manufactures petrochemicals,
acrylic fibers, and pulp chemicals and provides large-scale chlorine dioxide
generators to the pulp and paper industry. The Company has a petrochemical
plant in Texas City, Texas; an acrylic fibers plant near Pensacola, Florida; and
pulp chemical plants in five Canadian locations and one U.S. site.
This news release includes "forward looking statements"
within the meaning of Section 27A of the Securities Act of
1933 and Section 21E of the Securities Exchange Act of
1934, as amended. Although Sterling Chemicals believes
that such statements are based on reasonable assumptions,
it can give no assurance that its expectations will in
fact occur. Important factors that could cause actual
results to differ materially from those in the
forward-looking statements include the timing and extent
of changes in commodity prices and global economic
conditions, federal and state regulatory developments,
Sterling's high financial leverage, the availability of
skilled personnel and operating hazards attendant to the
industry, as well as the other risk factors discussed in
Sterling's Annual Report on Form 10-K for fiscal 1998.
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EXHIBIT 99.2
STERLING CHEMICALS AND MONSANTO ANNOUNCE
CONSTRUCTION OF A NEW PLANT AT TEXAS CITY, TEXAS
Houston, Texas February 25, 1999 . . .Sterling Chemicals, Inc. and
Monsanto, Inc. today announced plans to construct a new disodium iminodiacetate
("DSIDA") plant at Sterling's Texas City, Texas petrochemical facility. The new
plant will use hydrogen cyanide ("HCN"), a by-product from the acrylonitrile
manufacturing process, as its primary feedstock. The plans call for the
construction of a world-scale DSIDA plant, with production expected to begin in
the second calendar quarter of 2000. The project will require a multi-million
dollar investment, with Monsanto providing capital for the DSIDA plant and
Sterling investing in projects associated with its acrylonitrile plant that will
support the DSIDA project. DSIDA is an essential intermediate in the production
of Monsanto's Roundup (R) glyphosate based herbicide. Roundup (R) is the
world's top selling herbicide, with sales growing approximately 20 per cent per
year for the last five years.
Sterling also uses HCN for the production of sodium cyanide and tertiary
butyl amine, or TBA. Sterling operates DuPont's Texas City sodium cyanide unit,
and TBA is sold to Flexsys America L.P. Following the start-up of the new DSIDA
plant, Sterling's Texas City acrylonitrile facility is expected to use all of
its HCN by-product for chemical value.
During the past year, Sterling has significantly reduced fixed costs
through lower staffing levels and improved work practices at the Texas City
facility. In addition, acrylonitrile yield has improved through better
operations and the implementation of new catalyst technology. As well, the
formation of the joint venture acrylonitrile export marketing company, ANEXCO
LLC, with BP Chemicals, in April 1998, positioned Sterling to better serve the
needs of its overseas customers, while reducing marketing and distribution
costs.
Paul Rostek, vice president acrylonitrile & co-products for Sterling
commented, "For the past several years, our industry has gone through a
significant petrochemical trough. Rather than waiting for markets to recover,
Sterling has been focusing on cost reductions, improved work practices and
efficiency improvements at Texas City. The construction of the DSIDA plant at
Sterling's acrylonitrile facility is yet another major step in ensuring we will
be one of the cost leaders in our industry well into the future."
"We expect to operate one of the most cost competitive acrylonitrile
units in the world, as a result of recent upgrades, projects and cost saving
measures," stated Pete De Leeuw, president and CEO of Sterling. He went on to
say, "We also anticipate creating 15 to 20 new Sterling jobs at the DSIDA plant
when it goes on-line in 2000."
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Marty Blaylock, vice president for manufacturing, explains, "This new
DSIDA facility is an important element of Monsanto's long-range manufacturing
plan for Roundup (R) herbicide and is a known cost-effective route for
producing DSIDA. Farmers around the world are increasingly adopting
conservation-tillage and no-till farming methods, which are more
environmentally friendly ways of growing crops. These techniques reduce soil
erosion, benefit wildlife and are more sustainable ways to farm. Roundup (R)
herbicide is a key part of that trend and Monsanto is committed to meeting the
increasing need."
As a life sciences company, Monsanto is committed to finding solutions
to the growing global needs for food and health by sharing common forms of
science and technology among agriculture, nutrition and health. The company's
28,500 employees worldwide make and market high-value agricultural products,
pharmaceuticals, and food ingredients.
Based in Houston, Texas, Sterling Chemicals Holdings, Inc. is a
holding company that, through its operating subsidiaries, manufactures
petrochemicals, acrylic fibers, and pulp chemicals and provides large-scale
chlorine dioxide generators to the pulp and paper industry. The Company has a
petrochemical plant in Texas City, Texas; an acrylic fibers plant near
Pensacola, Florida; and pulp chemical plants in five Canadian locations and one
U.S. site.
This news release includes "forward looking statements"
within the meaning of Section 27A of the Securities Act of
1933 and Section 21E of the Securities Exchange Act of
1934, as amended. Although Sterling Chemicals believes
that such statements are based on reasonable assumptions,
it can give no assurance that its expectations will in
fact occur. Important factors that could cause actual
results to differ materially from those in the
forward-looking statements include the timing and extent
of changes in commodity prices and global economic
conditions, federal and state regulatory developments,
Sterling's high financial leverage, the availability of
skilled personnel and operating hazards attendant to the
industry, as well as the other risk factors discussed in
Sterling's Annual Report on Form 10-K for fiscal 1998.
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EXHIBIT 99.3
STERLING CHEMICALS ANNOUNCES STYRENE ENHANCEMENT PROJECT
Houston, Texas, March 3, 1999 . . .Sterling Chemicals, Inc. is pleased
to announce a capital project to upgrade its styrene monomer facility at Texas
City, Texas. The phenylacetylene removal project ("PAR project") will reduce
phenylacetylene ("PA") produced at Sterling's styrene monomer facility at Texas
City, Texas, and will employ Raytheon/Fina technology and a Criterion catalyst.
Sterling expects to invest approximately $7 to $8 million in the PAR project,
with the allocation of funds coming from the current capital expenditure budget.
During the current shutdown of the styrene unit, tie-ins for the PAR project
will be made with availability of the low PA styrene product expected by
December 31, 1999.
Conventional styrene processes produce relatively high levels of PA as a
byproduct of ethylbenzene dehydrogenation. PA is difficult to remove by
conventional distillation; therefore, the PA removal process will be used to
treat crude styrene before distillation. The Raytheon/Fina technology, coupled
with the Criterion catalyst, has been demonstrated to selectively remove PA with
minimum practical processing cost or loss of styrene monomer. Sterling expects
the low PA segment of the styrene market to continue to grow as specialty
polymer producers expand, build new facilities and develop new products.
Stan Land, vice president - styrene commented, "Sterling is committed to
investing in the overall quality of our business. Our current and future
customers deserve the best possible product performance, quality and service
excellence we can provide. The investment Sterling is making in phenyl
acetylene removal enhances our product performance, bringing our styrene monomer
to the highest standard of the industry."
Peter De Leeuw, president and CEO, explained, "The PAR project
represents Sterling's ongoing commitment to being a leading supplier to the
styrene market. Our goal is to have the highest quality product along with
exemplary services such that we are viewed as the premier competitor in the
styrene monomer business."
Based in Houston, Texas, Sterling Chemicals Holdings, Inc. is a holding
company that, through its operating subsidiaries, manufactures petrochemicals,
acrylic fibers, and pulp chemicals and provides large-scale chlorine dioxide
generators to the pulp and paper industry. The Company has a petrochemical
plant in Texas City, Texas; an acrylic fibers plant near Pensacola, Florida; and
pulp chemical plants in five Canadian locations and one U.S. site.
This news release includes "forward looking statements"
within the meaning of Section 27A of the Securities Act of
1933 and Section 21E of the Securities Exchange Act of 1934,
as amended. Although Sterling Chemicals believes that such
statements
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are based on reasonable assumptions, it can give no assurance
that its expectations will in fact occur. Important factors
that could cause actual results to differ materially from
those in the forward-looking statements include the timing
and extent of changes in commodity prices and global economic
conditions, federal and state regulatory developments,
Sterling's high financial leverage, the availability of
skilled personnel and operating hazards attendant to the
industry, as well as the other risk factors discussed in
Sterling's Annual Report on Form 10-K for fiscal 1998.
