2. Forward-looking Statements
This presentation contains forward-looking statements. These statements are statements that are not
historical facts, and are based on management’s current view and estimates of future economic
circumstances, industry conditions, company performance and financial results. The words "anticipates",
"believes", "estimates", "expects", "plans" and similar expressions, as they relate to the company, are
intended to identify forward-looking statements. Statements regarding the declaration or payment of
dividends, the implementation of principal operating and financing strategies and capital expenditure
plans, the direction of future operations and the factors or trends affecting financial condition, liquidity
or results of operations are examples of forward-looking statements. Such statements reflect the current
views of management and are subject to a number of risks and uncertainties. There is no guarantee that
the expected events, trends or results will actually occur. The statements are based on many
assumptions and factors, including general economic and market conditions, industry conditions, and
operating factors. Any changes in such assumptions or factors could cause actual results to differ
materially from current expectations.
The forward-looking statements in this presentation are valid only on the date they are made (December
31, 2009) and the Company does not assume any obligation to update them in light of new information
or future developments
Braskem is not responsible for any transaction or investment decision taken based on the information in
this presentation.
2
3. Agenda
Braskem overview and roadmap strategy
Acquisitions
Braskem post transactions
Projects in the pipeline
The global petrochemical industry
Key differentiators
2009 Figures
4. Braskem overview (before transactions)
Leading petrochemical company in Latin
America
Diversified portfolio of petrochemical
1 PVC
products, with focus on PE, PP and PVC
1 Chlorine - Soda
Annual capacity of 3,595 kty
17 facilities in Brazil Maceió
1st and 2nd generations integrated: states of BA,
Camaçari
RS, AL, SP. Naphtha based crackers. Petrobras is
main supplier with 60/65% of feedstock supply 1 Naphtha cracker
Listed in 3 stock exchanges: BM&FBovespa, 3 PE
Paulínia
NYSE and Latibex 1 PVC
1 Chlorine – Soda
100% tag along
Triunfo
1 PP
Key Financials 2009
Net Revenue: R$ 15.2 billion
1 Naphtha cracker
EBITDA: R$ 2.5 billion 5 PE
2 PP
Source: Braskem 4
5. Enhanced competitiveness through
value chain integration
Industrial integration
Oil/Gas-refineries Basic petchem Resins Converters
Naphtha / Gas PE/ PP/ PVC
HYGIENE AND CLEANING
2009 Braskem’s COSMETICS AND PHARMACEUTICAL
CONSUMER GOODS
Domestic Sales 13%
6%
2% AUTOMOTIVE
Breakdown 5%
RETAIL
5%
17% CONSTRUCTION
3%
ELECTRIC AND ELECTRONIC
FOOD PACKAGING 30%
6%
INDUSTRIAL
4%
4% INFRASTRUCTURE
4% 1%
AGRIBUSINESS
OTHERS
Source: Braskem / Abiquim 5
CHEMICAL AND AGROCHEMICALS
6. Track record of strong and consistent
growth aligned to its strategic direction
Vision 2020
Top 5 Global Petrochemical
Paulínia
Petroquímica
Ipiranga / Triunfo
Copesul
Politeno
2020
Polialden 2009
2007
2006
2002 Trikem
Be a Top 5
Global Petrochemical
Become leader in
thermoplastic resins 2005 2008
in Latin America
Formulation of
Formulation of 2020
2012 Vision
Vision
Source: Braskem 6
7. Strategic direction
Vision 2020 Braskem
Leader in the Americas,
rank among the 5 largest
petrochemical companies
worldwide and to be
positioned as the preferred
partner for global alliances
Source: Braskem 7
8. Agenda
Braskem overview and roadmap strategy
Acquisitions
Braskem post transactions
Projects in the pipeline
The global petrochemical industry
Key differentiators
2009 Figures
9. Benefits and strategic drivers of Quattor
acquisition
Creation of a world scale player
Diversification of feedstock supply
Scale increase and geographic complementarities
Operational synergies
Strategic alignment with Petrobras: Comperj and Suape participation
Value creation for all shareholders
Consolidation of Odebrecht and Petrobras shares in their activities in the
petrochemical sector, strengthening Braskem and the Brazilian production
chain to compete in the international market and ensuring the basis for
global growth, consolidating the leadership in the Americas
Source: Braskem 9
10. Quattor overview
Key Financials (2009 LTM*):
Net Revenue R$ 4.1 billion
EBITDA R$ 462 million Resins capacity (kton/y)
* LTM: Oct/08 to Sep/09 1,915
875
Profile:
PP
9 petrochemical plants with 1st and 2nd
PE
generations partially integrated: states of
SP, RJ
Private company 1,040
Source: Braskem / Company estimates / Quattor 10
11. Transaction stages
1. Creation of BRK Investimentos Petroquímicos SA (BRK) that will hold Braskem’s common
shares owned by Odebrecht (ODB) and Petrobras(PTB), followed by a capital increase
of R$ 3,5 billion, R$ 1 billion from ODB and R$ 2.5 billion from PTB
ODB PTB Capital ODB PTB
ODB/PTB
66,8% 33,2% 53.8% 46.2%
BRK BRK
2. Braskem capital increase through Private Offer of R$ 4.5 billion, with a minimum
subscription of R$ 3.5 billion assured by BRK. The Offer share price will be R$ 14.40 per
share
3. Braskem acquires Unipar 60% stake of Quattor Participações for R$ 647.3 million from
Unipar
4. Braskem merges Quattor shares, consolidating Petrobras/Petroquisa 40% interest in the
Company
5. Braskem acquires 33.3% of Polibutenos and 100% of Unipar Comercial for R$ 52.7
million
Transaction is expected to be concluded by June
Source: Braskem 11
12. Benefits and strategic drivers of Sunoco
acquisition
Internationalization through the acquisition of an important player in
the north American market
World scale player, technologically upgraded and with access to
competitive feedstock
Development of global production base in a market with further
industry consolidation opportunities
Foothold in the U.S. enhancing market for greenfield projects in Latin
America
Adding Sunoco Chemicals to the Braskem group furthers our objective of
being among the top 5 global petrochemical companies in the world.
Source: Braskem 12
13. Sunoco Chemicals
Key Financials (2009*):
Net Revenue R$ 1.9 billion
EBITDA R$ 140 million
* Company estimates
R&T Center
Profile:
Pittsburgh, PA
3 PP plants and 1 R&T Center: Texas, Marcus Hook, PA
Philadelphia and West Virginia Neal, WV 1 PP
1 PP
- Capacity: 950 kty
Public company
La Porte, Tx
Favorable cost position and flexible
1 PP
product mix
Transaction:
On February 1, 2010 Braskem acquired 100% of the shares of Sunoco Chemicals1, made
up of the Sunoco Polypropylene Business
Braskem America, a wholly owned subsidiary of Braskem, S.A. acquired the business for
$350 million in cash, to be paid within 60 days
1 The Phenol Business does not form part of this transaction Source: Sunoco / UBS 13
14. Agenda
Braskem overview and roadmap strategy
Acquisitions
Braskem post transactions
Projects in the pipeline
The global petrochemical Industry
Key differentiators
2009 Figures
15. Braskem - # 1 Resin Producer in the
Americas, now with plants in the USA
Key Financials (2009*):
Gross Revenue R$ 27.5 billion Resins capacity (kton/y)
Net Revenue R$ 21.2 billion
6,460
EBITDA R$ 3.1 billion
510
2,915
PVC
Profile:
PP
29 petrochemical plants : 26 in Brazil and
PE
3 in the USA
Listed on 3 stock exchanges: 3,035
BM&FBovespa, NYSE and Latibex
* Braskem 2009; Quattor LTM: Oct/08 to Sep/09; Sunoco: 2009 (Company estimates) Source: Braskem 15
16. Leader in the Americas and a top 8
global player in resins capacity
1th
Capacity in the Americas (kt/y)
6,460
510 5,307
4,827
4,256
4th
1,230 627
2,915
3,595
3,082
1,731 510
2,340 2,311
4,077 1,090 1,210 1,915
4,200 PVC
3,035 822 875 950
2,525 2,340 2,311 PP
1,995
1,050 1,040 950 PE
Braskem Exxon Dow Lyondell Braskem Formosa Shintech Chevron Quattor Sunoco
post Mobil Basell Philips
transactions
operations
World Capacity (kt/y)
10,914
9,311
8,668
7,749
8th
7,284 7,109
6,541 6,460
4,681 4,564 12th
4,303 4,079
3,595
Lyondell Exxon SINOPEC Dow Formosa SABIC Ineos Braskem Total IPIC Reliance PetroChina Braskem
Basell Mobil post
transactions
operations 16
17. Quattor Acquisition
Corporate Governance Principles
Maintenance of Braskem as a Private Company
Sharing of the strategic decisions (consensus approval)
Principles for the nomination of the CEO and Executive Management
- Odebrecht nominates Chairman of the Board, CEO and CFO;
- Petrobras nominates Vice Chairman of the Board, the Chief Investments and Portfolio Officers;
- Other Executive Officers will be selected by the CEO and submitted to the Board of Directors for
approval;
- For all the positions, members from among the best professionals in the market will be selected ,
renowned for their competence in exercising their functions.
Braskem Executive Management in charge of operational issues, including the approval of
Company’s Business Plan
Preferred partner for investments in the Brazilian petrochemical industry – COMPERJ, Suape
- COMPERJ: petrochemical complex in Rio de Janeiro state (1st and 2nd generations)
- Suape: textile complex in Pernambuco state
17
18. Acquisitions don’t significantly change
leverage
Strong liquidity with cash and cash equivalents of approximately R$8 billion (US$4.3
billion)
Capital structure with significant leverage (Net Debt/EBITDA) of approximately 3x
Estimated Capital
Estimated Capital
Increase R$4.5bi –
Increase R$4.5bi –
Sunoco Chemicals
Quattor Acquisition
Acquisition
Cash & Cash Equiv. 8,065 7,435
Gross Debt 17,386 17,386
Net Debt 9,322 9,952
Net Debt / EBITDA 3.17x 3.23x
Considering capital increase of only R$3.5 billion, leverage level is still comfortable:
3.51 to 3.56x
Quattor data LTM Sep/09
Source: Braskem, Unipar and Sunoco 18
19. Agenda
Braskem overview and roadmap strategy
Acquisitions
Braskem post transactions
Projects in the pipeline
The global petrochemical Industry
Key differentiators
2009 Figures
20. Growth with improved Competitiveness
(1/2)
Mexico - Project Ethylene XXI: startup 2015
Partnership with the Mexican group IDESA (65% Braskem,
35% IDESA) for the acquisition of ethane from PEMEX to be
used as feedstock for an integrated petrochemical project :
1 Mtons/y of ethylene and 1 Mtons/y of PE
Investment estimated in up to US$ 2.5 billion over the
course of 5 years, planned to be financed by a project
finance model with 70% debt and 30% equity
Venezuela: JV’s with Pequiven through Project Finances
with only 30% equity (under review)
Polipropileno del Sur – Propilsur: startup 2013
~350kton/y of PP and investments estimated at US$ 450
million (Paraguaná complex) or
450 kton/y of PP and investments estimated at US$1.2 Industrial assets
billion (Jose complex)
Polietilenos de America – Polimerica: delayed Greenfield projects
1.3 Mton of ethylene and 1.1 Mton/y of PE Projects with Petrobras
Peru
Braskem, Petrobras and PetroPerú concluded studies for the
technical and economic pre-feasibility phase of an
integrated project to produce 600 kton to 1,000 kton/y
using the natural gas available in Peru as feedstock 20
Source: Braskem
21. Growth with improved Competitiveness
(2/2)
Brazil
Green Polyethylene: Commitment to Sustainability
200 kton/y of green PE
Ethylene made from 100% renewable raw material, with
sugarcane ethanol used as feedstock
Investments of R$ 488 million and startup expected for 3Q10
70% of the ethanol volume required on final contract negotiation
Partnerships with national and multinational customers: food,
auto parts and cosmetic sectors
PVC Alagoas
210 kton/y of PVC capacity expansion in Alagoas
Investments around US$500 million and startup expected for the
2H2012 Industrial assets
Partnership with Petrobras in new projects (under evaluation) Greenfield projects
Suape: textile complex in the northeast region Projects with Petrobras
Comperj: production and marketing of resins and basic
petrochemicals to be developed in RJ state
Source: Braskem 21
22. Agenda
Braskem overview and roadmap strategy
Acquisitions
Braskem post transactions
Projects in the pipeline
The global petrochemical Industry
Key differentiators
2009 Figures
23. Global scenario
Petrochemical prices are expected to keep their bullish trend during the 1Q10 and
beginning of 2Q10:
Oil volatility and higher monomer cost
Production constrains in USA, Europe and Asia due to the cold weather
Planned maintenance shutdowns
Operational problems in the Middle East
However, several factors could push prices down:
New monetary policy in China (credit restrictions) versus economic growth
Sustainability of the European demand
Unemployment rates continuing to discourage US consumers
In Argentina, after a seasonal slowdown in industrial activity, market is expected to
improve during February
Brazilian demand for finished products holding steady with room for price increases in
R$ given devaluation of the currency and strong international price environment
23
24. Petrochemical Cycle
Downcycle less severe than expected
Points of concern Potential positive factors
Frequent delays in new capacities
Uncertainty regarding the extent of Operational and logistics problems
the global economic recovery
Increased economic importance of
Incentives to sustain supply buildup emerging countries with relevant
China: import substitution Supply & Demand domestic consumption, as Brazil and
Balance China
New ethylene and resins
capacities in the Middle East Supply-demand geographical
Stronger activity of capital imbalance leads to logistics barriers
investors in the commodity market Opportunities from assets on sale
Limited capacity utilization helps to
balance the market
Source: CMAI 24
25. Global supply of ethylene
2009 expected utilization rate:
Kton
45,000 90%
84% 80%
40,000 74% Lower global demand
35,000
30,000
25,000 growth and new
20,000
15,000 capacity additions
10,000
5,000 expected to come on
0
North Europe Middle East Asia
stream limiting the
America
utilization rates of the
Nameplate Capacity Effective Production
actual players
New ethylene capacity additions globally (Mton):
New capacity additions
12
could be delayed
10
8
6
4
Delayed
2
Go ahead
0
2010 2011 2012 2013 Source: Parpinelli Tecnon / CMAI / SRI 25
26. Agenda
Braskem overview and roadmap strategy
Acquisitions
Braskem post transactions
Projects in the pipeline
The global petrochemical Industry
Key differentiators
2009 Figures
27. Brazil: dynamic market with still
low per capita consumption
PE, PP and PVC per capita consumption
(Kg per person)
76
68
57
Brazil:
5.2%
CAGR*
22.7
21.9
20.2
17.8 18.7 18.0
16.2 16.6 17.5
15.4 16.1
14.5
12.5 13.6
11.1
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 USA Europe Japan
PE PP PVC
27
* Compound annual growth rate 27
Source: CMAI
28. In Brazil, companies are exposed to a
dynamic market with resilient growth
Domestic demand for resins (Kton/y)
5%
CAGR 1%
4%
10%
4,226 4,270
4,048
3,696
3,435 3,377 950
856 1,043
2,880 749
692
1,228 1,218 1,306 PVC
1,114
990 PP
3,435
PE
2,880
1,833 1,964 1,966 2,014
1,695
2001 2004 2005 2006 2007 2008 2009
Source: Braskem / Abiquim – domestic sales + imports 28
29. North America will be the natural
market for Braskem’s projects
PE and PP Capacity (Kton/y) versus Operating rate (%) Resins’ net balance (Kton/y)
31.000 3.500 22.818
21.417 21.486 22.127
86% 20.805 21.032
30.000
2.500
29.000
83%
1.500 Net Exporter
28.000 82%
81%
27.000 80% 500
79%
26.000
-500 2008 2009 2010 2011 2012 2013
25.000
-1.500 Net Importer
24.000
2008 2009 2010 2011 2012 2013 -2.500
Capacity Operating rate PEs PP Domestic Demand
Hypothetical and announced capacity shutdowns should lead to an increase in operating rates
Even considering a lower demand recovery, North America shall be a net importer of PP as of 2011
Source: CMAI 29
30. Management’s main priorities
Continued strengthening of long-term relationship with Customers
Support to the Brazilian petrochemical and plastic chain sustainability
Implementation of the acquisition stages of Quattor and Sunoco
Chemicals
Analysis of Braskem’s interest in the Suape (textile center) and Comperj
(1st e 2nd generation) projects
Conclusion of Green PE plant: on schedule and within planned Capex
Projects in Latin America: competitive feedstock
Assessment of selective acquisitions in North America
Maintain financial health and liquidity
Financial strength and respect for minority shareholders
Opportunities for internationalization
30
