Ashland and Cargill to combine talents for biobased chemical joint venture
First product: renewable propylene glycol
Ashland Inc. and Cargill have agreed in principle to create a new joint venture devoted solely to the development and production of biobased chemicals. The parties intend for the new stand-alone entity to become a leading global supplier of chemicals from renewable sources.
The venture's first product will be propylene glycol (PG). Using both licensed and proprietary technology, the joint venture shall produce high-grade propylene glycol from glycerin. The joint venture expects to provide global manufacturing and marketing of biobased PG, starting with a 65,000 metric ton-per-year plant at a yet-to-be-finalized location in Europe.
With a 50-50 ownership structure, Cargill and Ashland will bring to the new venture their unique technology, innovation and expertise in bioprocessing, along with chemical formulation, supply chain management and market analysis. The venture anticipates a combined initial capital investment in the range of $80 million to $100 million. Details on the name, leadership and development plans are expected to be announced later in 2007.
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