26 February 1996 00:00 [Source: ICB]
ELF ATOCHEM is to invest FF25-30bn ($5-6bn) over the next four years in a push to improve growth and profitability and increase its speciality chemicals base. Its pharma arm Sanofi has earmarked FF18bn for investments.
The figures were given at the group's annual results by Elf Aquitaine president and ceo Philippe Jaffré. They are part of the group's big FF130bn investment plans, now that Elf is back on track after a two-year restructuring period.
For Atochem the aim is to achieve a portfolio balance of one-third base chemicals and two-thirds specialities instead of the current 50:50 ratio. The shift goes hand-in-hand with the desire to increase sales outside Europe, from the current 25% to 30% with the focus on Asia and North America.
Restructuring over the past few years has bolstered Elf Atochem's performance in Europe; however, further synergies are to be developed between base chemicals (both petrochemicals and chlorochemicals) and specialities.
Elf said the sale of the remaining 30% in the Dunkirk steamcracker earlier this year (ECN 29 January) was part of the repositioning in base chemicals, as was the sale of Texasgulf at the start of 1995. The agreement with Electricité de France (EdF) which came into force in January this year will improve chlorine competitiveness, while the startup of Aspell's new facilities in 1996-97 will strengthen the group's PE position.
Internal growth in speciality chemicals will come through with the introduction of new CFC substitutes in 1996-97, as well as the startup of a hydrogen peroxide unit in Canada in 1997.
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