Variety Spices Small French Firm's Growth

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  • PLANT. Glass-lined reactors at Organo-Synthese's Gennevilliers plant turn out ultraviolet absorbers for plastics

    Variety Spices Small French Firm's Growth Organo-Synthese's new joint venture with Pittsburgh Plate Glass shows how a small firm can growthrough diversification

    The formation of Allymer Co. by Pitts-burgh Plate Glass and France's small, but spirited, Societe Francaise d'Organo-Synthese (C&EN, Dec. 30, 1963, page 15) may seem an unlikely venture. During the past four years or so, PPG has spun a network of joint ventures and licensing arrangements on the international scene. Probably few U.S. companies have even heard of Societe Francaise d'Organo-Syn-these. Yet a closer look at the part-nership indicates that the formation of the new French company is an ideal and logical move.

    For PPG, Allymer Co. means quick entry into a foreign market, with plant site, personnel, and a marketing setup already established. For Organo-Synthese, it means quick entry into a new field without having to build basic technical know-how on its own. The tie-up also shows what a small but enterprising and aggressive firm can do as it nimbly moves among giants on both sides of the Atlantic. Allymer Co. and Organo-Synthese are both headquartered at Neuilly-sur-Seine, a suburb of Paris.

    Only eight years ago, Organo-Synthese's annual sales were less than $1 million. Its product line was re-stricted largely to pharmaceutical and fine chemicals. The company now

    handles about 40 products including a large number of industrial chemicals such as antioxidants, blowing agents, textile auxiliaries, plastics, plasticizers, and ultraviolet light absorbers. Quan-tities range from kilograms to outputs as high as 600 metric tons a year, de-pending on the product. Since the beginning of 1956, sales have in-creased about 10-fold.

    Parent. Since 1954, Organo-Synthese has been part of Laboratoire Roger Bellon, a leading French phar-maceutical house. Roger Bellon now holds 84% of the company's stock. Kleber-Colombes, a big French tire maker, and private investors hold the remaining 16%. Organo-Synthese was formed as a privately owned company in 1931, and until 1956 was known as Zundel, Joliet et Compagnie.

    The Roger Bellon group, aside from Organo-Synthese, includes Orbel, S.A.R.L., a 50/50 joint venture with Great Britain's Smith and Matthews. Several weeks ago, Rhone-Poulenc, France's largest chemical company, acquired a 25% interest in Roger Bellon.

    Roger Bellon doesn't split out the sales of its individual companies, but group sales in the year ended Aug. 31, 1963, were about $24 million com-pared to about $20 million the year

    before. In the first four months of its current fiscal year, consolidated sales were up 26% over the same period a year earlier.

    Diversification. Master-minding much of Organo-Synthese's growth is softspoken but aggressive Fred Aftalion, the firm's newly elected presi-dent. When Mr. Aftalion, now 41, joined Organo-Synthese in 1956, he found a company with about a 50/50 split between pharmaceutical and in-dustrial chemicals. Although the firm had its roots in pharmaceuticals and fine chemicals, Mr. Aftalion quickly saw that growth lay not here but in industrial chemicals.

    For one thing, some of the custo-mers for Organo-Synthese's pharma-ceutical materials make products that compete with Roger Bellon. Under-standably, they don't like to help the competition. Also, most pharmaceuti-cal labs, as they grow, start making their own raw materials. This means that companies such as Organo-Synthese tend to lose their best cus-tomers.

    Mr. Aftalion's varied background has girded him unusually well for his tasks as president of Organo-Synthese. He is a graduate in chemical engineer-ing of the ficole Nation ale Superieure de Chimie de Paris (part of the

    58 C & E N FEB. 10, 1964


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    G E N E R A L A N I L I N E &. F I L M C O R P O R A T I O N 435 HUDSON ST., NEW YORK 14, N.Y.

    C & E N 59









  • TOP MAN. President Fred Aftalion ties firm's growth to specialty chemicals

    Sorboime). Later, for one year, he studied under Dr. Herman Mark at Polytechnic Institute of Brooklyn. For five years, he was with Hercules Powder, both in its research and ex-port departments. From Hercules, Mr. Aftalion shifted to Naphthachimie, a big French petrochemical firm, where he was in charge of sales.

    In his seven years with Organo-Synthese, Mr. Aftalion has tipped the company's former 50/50 product split to 80/20 in favor of industrial chemicals by implementing his phi-losophy of growth through diversifica-tion.

    A first step in Organo-Synthese's diversification was a licensing agree-ment in 1956 with Union Chimique Beige, a Belgian firm, to make acrylic, methacrylic, and acrylo-vinyl polymers and copolymers for the French mar-ket. These products are used in glues, textiles, leather, and paints.

    Similar moves quickly followed. In 1957, Organo-Synthese began making the antioxidant 2,6-di-tert-buty\-p-cresol, using a process developed in its laboratory at Gennevilliers near Paris. This chemical is used in plastics, rub-ber, and lubricants.

    At about the same time, the firm obtained a license from West Ger-many's Farbenfabriken Bayer to make Renacit IV, a peptizing agent for rub-ber, in France. Organo-Synthese already had a Bayer license to supply Porofore BSH, a blowing agent for high polymers derived from hydra-zine.

    With demand for hydrazine-based

    blowing agents by the plastics industry on the upswing, Organo-Synthese next worked out its own process for making azoisobutyronitrile (AZDN) and azo-dicarbonamide. It has made this proc-ess know-how available to Olin Mathieson, with which it exchanges technical information.

    AZDN is also a source of free radi-cals. This led Organo-Synthese into polymerization and cross-linking cata-lysts. In addition to AZDN, the firm sells 4,4-azo-bis-4-cyanovaleric acid, a catalyst for blocked polymers, and is now, through Allymer Co., getting set to make and sell PPG's isopropyl percarbonate (IPP) and tert-buty\-oxy-isopropylpercarbonate (BPIC). IPP is a catalyst used in making poly-vinyl chloride and high-pressure proc-ess polyethylene. BPIC is a cross-linking agent for ethylene-propylene copolymers.

    Into Plastics. Its work with blow-ing agents and catalysts prompted Organo-Synthese to make other prod-ucts for plastics producers. The re-sult was a full range of ultraviolet absorbers and a polymerization in-hibitor, 4-ferf-butyl-catechol.

    The next move was into plastics. In 1962, Organo-Synthese was licensed by PPG to make diallyl glycol carbo-nate. Trade-named Allymer CR-39, diallyl glycol carbonate is a momomer used to make a transparent, thermo-setting plastic used in lenses and safety glasses. Organo-Synthese's agreement with PPG included a provision for a possible joint venture sometime in the future, and, of course, Allymer Co., owned equally by the two firms, has now been formed.

    For now, Organo-Synthese will con-tinue to make Allymer CR-39 at its plant in Gennevilliers; Allymer Co. will distribute it. Later, Allymer Co. may make the monomer itself. In ad-dition, x\llymer Co. will soon make IPP in a plant in Monts, near Tours, as well as distribute BPIC and a series of herbicides based on carbamates.

    Allymer Co. will also sell finished cast sheets and molded articles of Allymer CR-39. These will be the first finished plastic products made by Organo-Synthese or its subsidiaries.

    Other products sold by Organo-Synthese include a series of resins based on diphenolic acid and used in printing inks, overprint varnishes, and similar products (licensed by S. C. Johnson) and textile auxiliaries based on hydrazinium derivatives (licensed by W. R. Grace & Co.). Proced,

    jointly owned by Pechiney-St. Gobain (75 %) and Organo-Synthese (25 % ) , sells a series of chlorocyanuric bleach-ing agents (licensed by FMC Corp.). Organo-Synthese is also the exclusive sales representative in France for the chemical division of Celanese Corp. of America. And, of course, Organo-Synthese continues to make pharma-ceuticals and intermediates for syn-theses for Roger Bellon as well as other customers.

    Throughout its growth, one of Or-gano-Synthese's goals has been to mar-ket new products as quickly as pos-sible. In meeting this goal, Mr. Aftalion has used just about every means available. He has pushed the firm's research and development effort, stressing applied rather than funda-mental research. One result of this effort is a new product (a mixture of alkylated cresols) that can be used both as a fungicide and an insecticide. Mr. Aftalion has also sought licenses for various products. He has been instrumental in setting up two joint ventures, Allymer Co. and Proced, and, under his direction, the firm has ac-cepted distributorships.

    What Next? Organo-Synthese will continue to branch out into new areas and to expand its current line of prod-ucts. According to Mr. Aftalion, the firm will stick with specialty chemi-cals, where it can focus its know-how on organic syntheses and technical service. He sees no point in trying to tilt with the giants, or "big ones," as he calls them. His firm has found a niche as both customer (raw ma-terials) and supplier (specialties) of the larger firms.

    Organo-Synthese will also try to in-crease its exports, which now take about 15% of production. Mr. Aftalion expects the company's sales to double in the next five years.

    The European Economic Com-munity has meant stronger competi-tion for Organo-Synthese. Neverthe-less, the formation of the common market has helped more than hindered Organo-Synthese's growth, Mr. Aftalion believes. For example, the firm can buy raw materials on more favorable terms now than it could be-fore EEC's tariff policies went into effect. Mr. Aftalion also believes that a successful conclusion of the up-com-ing "Kennedy round" of tariff talks can only help. "In our field of specialty chemicals, U.S. firms are so solidly protected that any modification will be in our favor," he says.

    60 C & E N FEB. 10, 1964

    INTERNATIONALVariety Spices Small French Firm's Growth


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