UpdatePerstorp to buy isocyanates units

19 March 2008 09:26  [Source: ICIS news]

(Updates, adds comments and background throughout)

LONDON (ICIS news)--Rhodia and Lyondell Chimie have entered into exclusive negotiations for the sale of their isocyanates businesses to Swedish specialty chemicals firm Perstorp, the France-based Rhodia said on Wednesday.

The sale includes Rhodia’s aliphatic isocyanates segment, which produces intermediates for industrial paints and coatings, and Lyondell’s aromatic isocyanates business, which manufactures intermediates for polyurethane foams, the company said

The aromatic isocyanates business of Lyondell is operated by Rhodia, it added.

“This divestment project is the last major step in the refocusing of the group’s [Rhodia's] portfolio and will enhance its financial structure,” it said.

The completion of the sale of these isocyanates activities, which are based in Pont-de-Claix in France and at Freeport in the US and together employ about 680 people, would take place in a few months after the necessary approval was secured, the company said.

A Perstorp spokeswoman said since French investment company PAI bought a controlling interest in it, Perstorp had a strategy of growth.

 

This is both organically with the increasing of volume at plants and through acquisitions, she added.

 

“We are growing in the specialty chemicals market,” she said before adding that presently Perstop was focused in that market but the company wanted to widen it.

 

She refused to comment on what plans Perstorp had for the business, which was described by Rhodia’s CEO Jean-Pierre Clamadieu at the end of February as underperforming.

 

The isocyanates business had net sales of €298m ($191m) in 2007 while its earnings before interest, tax, depreciation and amortisation was €39.

This divestment project would lead to the break-up of the Rhodia organics enterprise.

“Our business portfolio which is now made up of strong and longstanding leadership positions in high growth markets together with our confirmed pricing power give us confidence to meet the challenges of 2008 and beyond,” said Jean-Pierre Clamadieu, chairman and CEO of Rhodia.

Rhodia's isocyanates business is expected to be classified in discontinued operations from the first quarter of 2008.

Lyondell Chimie is an affiliate of LyondellBasell Industries.

At 14.21 GMT Rhodia shares were up 2.75% since last night’s close to €13.09 on the Euronext.

 

($1=€0.64)

 

Lucy Craymer contributed to this story

By: Isha Jha
+65 6780 4359

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly