Subsequent Events

6 Months Ended

Jun. 30, 2020

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

Accounts Receivable Securitization

On July 6, 2020, the Company entered into an amended and restated receivables purchase agreement (the "Amended Receivables Purchase Agreement") under its US accounts receivable securitization facility among Celanese International Corporation, as servicer, certain of the Company's domestic subsidiaries, the Company's SPE, PNC Bank, National Association ("PNC Bank") and SMBC, as the Purchasers, and PNC Bank as administrator. The Amended Receivables Purchase Agreement extends the term of the securitization facility such that the SPE may sell certain receivables and request letters of credit until July 2, 2021 or upon a termination event, and contains certain representations, warranties and covenants. Under the Amended Receivables Purchase Agreement, transfers of US accounts receivable from the subsidiaries to the SPE are treated as sales and are accounted for as reductions in Trade receivables because the agreement transfers effective control over and risk related to the US accounts receivable to the SPE. The Company and related subsidiaries have no continuing involvement in the transferred US accounts receivable, other than collection and administrative responsibilities and, once sold, the US accounts receivable are no longer available to satisfy creditors of the Company or the related subsidiaries. As a result, on July 6, 2020, the Company sold $87 million of its US accounts receivable to the Purchasers and repaid $87 million of borrowings from the US accounts receivable securitization facility. These sales were transacted at 100% of the face value of the relevant US accounts receivable, resulting in derecognition of the US accounts receivables from the Company's unaudited consolidated balance sheet. Unsold US accounts receivable of $30 million were pledged by the SPE as collateral to the Purchasers.

Sale of Polyplastics Co., Ltd. Joint Venture Equity Interest

On July 20, 2020, Celanese and a certain subsidiary entered into a definitive agreement to sell its 45% joint venture equity interest in its strategic affiliate, Polyplastics Co., Ltd. ("Polyplastics"), to its joint venture partner Daicel Corporation ("Daicel"), for a purchase price of approximately $1.6 billion in cash.

In addition to the sale of the Company's 45% equity interest in Polyplastics, the agreement provides for the amendment of certain supply agreements and the execution of certain intellectual property licenses between Celanese, certain of its affiliates and Polyplastics and Daicel, as applicable, as well as the termination of certain agreements and a mutual release of liabilities under such terminated agreements.

The transaction is currently expected to close in the second half of 2020, subject to possible extension. Consummation of the transaction is subject to customary closing conditions, including, among others, receipt of certain antitrust approvals, accuracy of representations and warranties, and performance by the parties of their respective covenants. Until the closing, Polyplastics will continue to operate under its current joint venture ownership structure and will continue to pay dividends in accordance with the existing joint venture agreements. Equity investment in earnings and dividends from Polyplastics are included in the Company's Engineered Materials segment.