At least three leading chemical companies are set to vie for BP Plc's (NYSE: BP) stake in Chinese petrochemicals joint venture SECCO, which could fetch more than $2 billion, sources close to the process said.
Offers for the 50% stake, which is the British oil and gas company's largest investment in China, will be submitted in the coming days, the sources said.
SK Chemicals Co. Ltd., a pharmaceutical unit of South Korea's SK Group; Austrian plastics group Borealis, which is owned by Abu Dhabi's sovereign wealth fund IPIC and oil and gas company OMV; and privately owned Switzerland-based chemical company Ineos are set to bid for the asset, the sources said, speaking on condition of anonymity as the information isn't public.
At least one other company is considering entering the bidding round.
BP's partner in the joint venture, state-owned China Petroleum & Chemical Corp. (Sinopec), has a right of first refusal. It said it is discussing the conditions put forward by BP, but has made no decision.
BP and the three potential bidders declined to comment or were not immediately available to comment.
SECCO, a venture formed in 2001, produces ethylene and propylene, which are used to make resins, plastics and synthetic rubbers.
BP, like other top oil companies, is driven to divest in order to focus its business and boost cash flow in the wake of the halving of oil prices since mid-2014. It is planning sales worth $3 billion to $5 billion this year.
The company has sold more than $50 billion of assets since a deadly explosion on an oil rig in the Gulf of Mexico in 2010.
BP has sold several assets to Ineos in recent years, including the Grangemouth refinery in Scotland as part of a $9 billion sale of the olefins and refining business Innovene in 2005.