(equivalent to about $9.2 M). The newplant is scheduled to start-up in April2014.

Original Source: Japan Synthetic Rubber Corp, 1-9-2Higashi Shinbashi, Minato-ku, Tokyo, Japan, website:http://www.jsr.co.jp (14 Feb & 4 Mar 2013) © JSRCorp 2013

Russia: Gabriel – masterbatches

Gabriel Chemie plans to build a newmasterbatch plant at a 5 hectares sitein the Alabuga Special EconomicZone within Tatarstan republic/province (about 200 km east of Kazanand 1000 km east of Moscow).Construction work will commencelater this year and the plant should befully on-stream by 2015. It will have aninitial capacity for producing 4000tonnes/y of additive and colourmasterbatches, which will eventuallybe raised to 14,000 tonnes/y and willinclude black and whitemasterbatches. As well as themanufacturing plant, there will also bea laboratory and warehouse facilitieson the Alabuga site. Gabriel alreadyhas a masterbatch plant, laboratoryand warehouse at Ruzsky, anorthwestern suburb of Moscow.These facilities will remain here,together with the company’s Russiansales headquarters.

Gabriel Chemie is an independentprivately owned company, founded inAustria in 1950. It now employs 461people and it has six plants, namelyat: Moscow-Ruzsky (Russia); LazneBohdanec (10 km northwest ofPardubice, Czech Republic);Nyireghaza (50 km north ofDebrecen, Hungary); WeitnauOberallgäu (150 km southwest ofMunich, Germany); Paddock Wood(15 km southwest of Maidstone, UK);and Gumpoldskirchen (25 km south-southwest of Vienna, Austria). Lastyear, the company reported salesrevenue at €85.6 M, of which 25%was accounted for by sales tocustomers outside Europe.

Original Source: RCCnews, 20 Mar 2013, (Website:http://www.rccnews.ru/eng) © RCCnews.ru 2013

Saudi Arabia: PolyOne & Juffali –plastics masterbatch

The new $14 M coloured masterbatchplant at Jeddah on the Red Sea coastof Saudi Arabia recently commenced

production. It was built and will beoperated by Juffali PolyOneMasterbatch Co Ltd, which wasregistered in October 2011 and isowned 51% by PolyOne Corp (of AvonLake, OH) and 49% by EA Juffali &Brothers Co Ltd (headquartered inJeddah). The joint venture wasdescribed as the logical extension of 30years of cooperation between the twocompanies. (See also ‘Focus onPigments’, Dec 2011, 7).

Original Source: PolyOne Corp, 33587 Walker Road,Avon Lake, OH 44012, website:http://www.polyone.com (9 Apr 2013) © Polyone2013

United Kingdom: Cabot – fumed silica

Cabot Corp recently completed a 25%expansion of its fumed silica plant atBarry (15 km southwest of Cardiff,South Wales). No details were givenon the absolute capacity of the Barryplant, but it is known that Cabot is oneof the world’s two largest suppliers offumed silica.

Cabot has six fumed silica plantsaround the world – at Barry,Rheinfelden (Germany), Tuscola, ILand Midland, MI (United States),Mettur (India) and Jiujiang (Jiangxiprovince, China). The expansion atBarry was part of Cabot’s programmeto raise its worldwide capacity forfumed metal oxides by 35-40%between 2011 and 2014.

At its Barry site, Cabot has aninterdependent relationship with DowCorning, which runs a siliconemonomer plant at the adjacent site.Dow Corning supplies silanes toCabot for conversion to fumed silicaand Cabot supplies fumed silica toDow Corning for the manufacture ofcompounded silicones. Thisinterdependent relationship datesback to 1991.

Thanks to the recent project, Cabotcan now use a wider range of silaneraw materials to make a broaderportfolio of silicones. According toCabot, the world’s consumption offumed silica for making silicones ispoised to rise by 6-9% per annumover the next 10 years. Fumed silicawill also be used more widely in theadhesives, rubber and plasticsindustry.

Original Source: Chimie Pharma Hebdo, 2 Apr 2013,(628) (Website: http://www.industrie.com/chimie/) (inFrench) © ETAI Information 2013

COMPANIESSachtleben buys-out Kemira in order tofacilitate sale of its TiO2 business

Rockwood Holdings Inc has paid€97.5 M to buy out Kemira’s 39%stake in the Sachtleben joint venture.The agreement was signed on 14February and the transaction wasofficially completed within a week. Atthe same time as announcing thisacquisition, Rockwood made it clearthat it is hoping to dispose of its TiO2business later this year. Mr SeifiGhasemi (Chairman & CEO ofRockwood) said: “Given our priorstatements that the TiO2 business isnon-core, it is our key objective thisyear to explore and execute on thebest strategic option for Rockwood.Attaining 100% ownership of the jointventure provides us with the flexibilityto achieve this goal in the timeframeand manner most optimal formaximising shareholder value.” Tofurther facilitate the disposal ofSachtleben, Rockwood has used cashin hand to pay-off Sachtleben’s€394.5 M worth of term loans anddebt assumed under a revolving creditfacility.

Sachtleben Pigments was createdby the pooling of the TiO2 assets ofRockwood and Kemira and it begantrading with effect from 1 September2008. Sachtleben contributed its100,000 tonnes/y sulfate-route TiO2plant at Duisburg (Germany), whileKemira contributed its 130,000tonnes/y sulfate-route TiO2 plant atPori (Finland). The new entity, owned61% by Rockwood and 39% byKemira, had pro forma sales revenuesof €556 M for full-year 2007. (Seealso ‘Focus on Pigments’, Jul 2008,7). In July 2012, Sachtleben furtherexpanded by acquiring the 107,000tonnes/y sulfate-route TiO2 plant ofCrenox (formerly Tronox Deutschland)at Krefeld-Uerdingen (Germany).Sachtleben now employs 2250 people– 1150 at Duisburg, 550 at Krefeldand 550 at Pori.

Thus, Sachtleben became theworld’s sixth largest TiO2 multi-national, with a total TiO2 pigmentcapacity of nearly 340,000 tonnes/y.The company has a long-establishedreputation for supplying high-qualityspecialty grades of anatase TiO2 forthe synthetic fibre, printing ink, food,

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pharmaceutical, cosmetics andcatalyst sectors. It also suppliessubstantial quantities of conventionalrutile-grade pigments for paints,plastics, paper and other applications.In addition to TiO2, Sachtlebenoperates a flourishing business inmarketing regenerated sulfuric acid.

For full-year 2012, Rockwood’s TiO2business reported adjusted earningsbefore interest, tax, depreciation andamortisation (EBITDA) at $164.7 M onsales revenues of $889.4 M, comparedagainst $257.6 M on $930.4 M for full-year 2011. Sachtleben reported asqueeze between rising TiO2 feedstockcosts and falling TiO2 pigment demandand prices. The company turned downits average TiO2 plant operating rate to65% in 4Q 2012 in order to avoid anexcessive build-up of pigmentinventories.

Original Source: Rockwood Holdings Inc, 100Overlook Center, Princeton, NJ 08450, USA, tel: +1609 524 1101, website: http://www.rocksp.com (14 Feb & 22 Mar 2013) © Rockwood 2013

Schulman pursues $855 M bid for Ferro

On 4 March 2013, A Schulman Incannounced that it had made anunsolicited offer to acquire the entirebusiness and assets of Ferro Corp for$855 M. Both Schulman and Ferrohave their global headquarters in Ohioand both companies specialise in themanufacture of plastic masterbatchesand additives. Ferro also supplies fritsand colorants for the ceramic andglass industries. Schulman’s offerconsists of $6.50 per Ferro share, ofwhich 50% payable immediately ascash, with the remainder payable asshares of Schulman common stock.This offer represents a 25% premiumon the closing price of Ferro shareson the New York Stock Exchange atthe close of business on 1 March. Italso represents a 32% premium onthe volume-weighted average priceover the previous 60 days. In itsstatement, Schulman revealed that ithad first contacted the Ferro Board ofDirectors with its takeover proposal inNovember 2012. Schulman thenfollowed up in mid-February 2013 witha letter “expressing its strong intent topursue the combination”, but Ferrorejected the offer.

Mr Joseph Gingo (CEO ofSchulman) commented: “We havetremendous respect for Ferro and for

its people. But cashflow is required,not only for the restructuring effortsalready publicly identified by Ferro,but also for growth, for the capacity tobe opportunistic in the marketplace,and for the ability to create value forshareholders. Over the past fiveyears, Schulman has generated morethan $400 M in free cashflow. Duringthat same period, Ferro hasgenerated approximately $60 M. Ourability to generate strong freecashflow and our successful trackrecord of integrating acquisitions andrecognising synergies ahead ofschedule will help to accelerate andimprove Ferro’s value-creationtimeline.”

According to Schulman, theacquisition of Ferro would providesynergies of $35 M per year, inaddition to Ferro’s previouslyannounced projected savings of $50M. As well as the near-term synergiesand potential restructuringefficiencies, the long-term benefits toSchulman and Ferro shareholdersshould include substantially enhancedreturns on invested capital and furthergrowth in higher-margin businesssegments and global markets. Theproposed transaction should beaccretive in the first year following theacquisition.

For the year to end-August 2012,Schulman reported sales revenues at$2.1 bn. It has 3300 employees and34 manufacturing sites around theworld. For the six months to end-February 2013, Schulman reportednet income at $23.6 M on sales of$1.063 bn. Ferro has 4950 employeesand it reported a net loss of $374.3 Mon sales revenues of $1.77 bn for theyear to end-December 2012,compared against a net profit of $31.6M on $2.16 bn for the previous year.

On 18 April 2013, the Ferro Boardissued a letter to its shareholders,which essentially rejected theSchulman proposal as a “low-balloffer.” Moreover, it identified twoinvestment groups – Frontfour CapitalGroup and Quinpario LLC – asdeliberately misleading other Ferroshareholders into undervaluing thecompany’s prospects.

Four days later, Schulman issued apress-release, indicating itswillingness to revise the terms andstructure of its offer on condition that itshould be given the opportunity to

conduct customary due diligence onexamining Ferro’s business andengaging in meaningful dialogue. MrGingo said: “Ferro has chosen tomisrepresent our position, has madeunsubstantiated and inaccuratestatements about Schulman’s abilityto complete the acquisition, and hasnot mentioned the overwhelmingsupport from both Ferro andSchulman shareholders forconsideration of our proposal. Thissupport is reflected by the perfor-mance of Ferro’s stock, which rapidlyclimbed from $5.20 to $6.80 per shareon the day of the announcement ofthe offer, representing a 31% gain inshareholder value on that day alone.Schulman believes that a significantreason for the gain in Ferro’s stockprice is the investment community’spositive reaction to a potentialtransaction, rather than an overnightendorsement of Ferro’s current cost-cutting measures. Conversations withour own shareholders indicateoverwhelming support for Schulman’sattempts to acquire Ferro, with noconcerns about dilution, contrary towhat the Ferro Board implies in itsletter. Our strong balance sheet andlow debt-to-capital ratio of 30% (as atend-February 2013) coupled with ourproven ability in cashflow generation,clearly indicate that we have thefinancial capability to successfullycomplete the acquisition in a timelymanner. Although we are notencouraged by the global economicenvironment and its impact on theplastic compounding industry, as wehave successfully demonstrated in thepast, we will aggressively managewhat we can control while drivinggrowth through new products andvalue-generating acquisitions, includingexpansion into adjacent markets. Weintend to transform Schulman beyondplastics into a premier specialitychemical organisation. We believe ouroffer for Ferro merits seriousconsideration, and we continue toengage Ferro shareholders in hopesthat we can enter into mutuallybeneficial conversations with theirBoard of Directors.”

Original Source: Ferro Corp, 4150 East 56th Street,Cleveland, OH 44105, USA, website:http://www.ferro.com (18 Apr 2013) © Ferro 2013.Original Source: A Schulman Inc, 3637 RidgewoodRoad, Copley, OH 44321-1678, USA, website:http://www.aschulman.com (4 Mar & 8 Apr & 22 Apr2013) © Schulman 2013

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