Ashland and Süd-Chemie to combine global business activities in the metal casting industry

23-Jun-2008

Ashland Inc. and Süd-Chemie AG signed a nonbinding memorandum of understanding to form a new, global joint venture to serve foundries and the metal casting industry. When final agreements are reached, each parent company will hold a 50-percent share of the joint venture, which is planned to be headquartered in Venlo, The Netherlands.

Assets and employees would transfer to the new joint venture upon closing, anticipated by early calendar year 2009. The transaction is dependent upon the successful negotiation of definitive agreements, and closing will depend upon satisfactory completion of due diligence and a number of standard closing conditions, including regulatory review.

The new enterprise would combine three businesses: Ashland's Casting Solutions business group, the foundry-related businesses of Süd-Chemie, and Ashland-Südchemie-Kernfest GmbH (ASK). Had it existed in 2007, this new company would have generated sales revenues of approximately U.S. $1.1 billion or EUR700 million, with approximately 1,300 employees.

Süd-Chemie and Ashland pursue a similar strategy aimed at providing solutions for the rising technological requirements of modern and worldwide expanding foundries and seeking international expansion, especially in developing countries. In combination, the complementary business positions should enjoy well-established channels to serve the European marketplace, the Americas and Asia, and should help to achieve high growth potential.

"When you consider the rapid industrialization occurring within key markets like China, Eastern Europe, Brazil and India, it is easy to recognize the strong growth opportunities that exist for the metal casting industry," said James J. O'Brien, Ashland's chairman and chief executive officer. "Combining these businesses should ultimately result in increased shareholder value and better opportunities for our customers and employees."

https://www.chemeurope.com/en/news/83623/ashland-and-sued-chemie-to-combine-global-business-activities-in-the-metal-casting-industry.html