Süd-Chemie and Ashland agree on expanded joint venture serving foundry chemical sector
Süd-Chemie AG and Ashland Inc. have reached contractual agreement on the formation of a global joint venture to merge their business activities in the foundry chemicals sector. The joint venture will be known as ASK Chemicals GmbH and will be headquartered in Hilden, Germany. Süd-Chemie and Ashland will each hold a fifty-percent share in ASK Chemicals, while the operational management leadership will lie with Süd-Chemie.
This joint venture will employ approximately 1,300 people. Were it to have been in operation through the first six months of calendar year 2010, it would have generated total sales of about €240 million, or around $300 million – numbers reflecting that while the global foundry market saw moderate activity in Q1, it gained considerable momentum in Q2.
Süd-Chemie and Ashland are currently partners in Ashland-Südchemie-Kernfest GmbH, a foundry chemicals company operating successfully in Europe since its formation in 1970. The global joint venture will be comprised of three parts: Ashland-Südchemie-Kernfest, substantially all assets and employees of Süd-Chemie´s business unit for Foundry Products and Specialty Resins and Ashland´s Casting Solutions business unit. The transaction is expected to close towards the end of calendar year 2010, subject to customary closing conditions including regulatory reviews.
The expanded joint venture will combine Süd-Chemie´s and Ashland´s sales and marketing, product development units and production assets with those of the Ashland-Südchemie-Kernfest joint venture. The new joint venture will have considerable growth potential as a result of uniting the foundry know-how of the partners and expanding the use of existing distribution channels and market synergies in Europe, the Americas and Asia.
Operations merging into the ASK Chemicals GmbH joint venture are the Casting Solutions business unit of Ashland Inc., including assets in the United States, Canada, Mexico, Brazil, China, Japan, the UK, Spain, Portugal, Italy, India and Korea; Süd Chemie's Foundry Products and Specialty Resins business unit including the Süd-Chemie subsidiaries SKW Giesserei GmbH, WD-Giesserei-Technik GmbH, Tecpro Corporation Inc., Süd-Chemie Hi-Tech Ceramics Inc., Ajay Metachem Süd-Chemie Pvt. Ltd., parts of Jiangsu Süd-Chemie Chemical Materials Co., Ltd. and the companies belonging to the existing joint venture, Ashland-Südchemie-Kernfest GmbH, and its subsidiaries (AS Group).
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