Bayer separates Material Science business into Covestro

MOSCOW (MRC) -- Bayer AG moved a step closer to floating its EUR11 billion (USD12.3 billion) specialty chemicals business by "legally and economically" separating the unit, now named Covestro AG, said the Wall Street Journal.

The German pharmaceuticals group plans to float Covestro, previously called Material Science, by the middle of next year and potentially as soon as this fall. Bayer plans either an initial public offering or direct spinoff to shareholders. The company has previously indicated that it preferred an IPO, which would generate cash for heavily indebted Bayer.

Bayer’s commodity chemicals business, which primarily produces polyurethanes and polycarbonates used in products ranging from Mercedes-Benz door handles to an airplane hangar at Frankfurt Airport, has long been a "cash machine" for the Bayer group, but is also a high-growth business, Covestro Chief Executive Patrick Thomas said in an interview ahead of the separation.


Volume in the global polyurethanes and polycarbonate market increased by an average growth rate of 7% between 1976 and 2014, Mr. Thomas noted, and to maintain that tempo Covestro will "have to keep investing capital if it wants to keep growing." That “growth potential” makes the business "very attractive from a shareholder’s perspective," he added.

But for Bayer, which has in recent years focused on its core Health Care business and its lucrative pharmaceutical drug pipeline, the capital investment became too burdensome.

As MRC informed earlier, the plan for Bayer MaterialScience to become a separate company was announced in September 2014.

Bayer is a global enterprise with core competencies in the fields of health care, agriculture and high-tech polymer materials. As an innovation company, it sets trends in research-intensive areas. Bayer's products and services are designed to benefit people and improve their quality of life. At the same time, the Group aims to create value through innovation, growth and high earning power. Bayer is committed to the principles of sustainable development and to its social and ethical responsibilities as a corporate citizen. In fiscal 2014, the Group employed 118,900 people and had sales of EUR 42.2 billion.
MRC

MOSCOW (MRC) -- PPG Industries announced that it has completed its acquisition of IVC Industrial Coatings, Inc., a U.S.-based specialty powder and liquid coatings manufacturer with 2014 sales of more than USD100 million, said the company in its press release.

Financial terms were not disclosed. "This acquisition brings industry-leading powder coatings and a best-in-class manufacturing capability that will strengthen PPG’s position in the industrial coatings market," said Shelley Bausch, PPG vice president, global industrial coatings. "We have been impressed with IVC’s strong customer focus and overall business performance, and believe that together we can offer even greater solutions for our customers."

The acquisition comes after PPG reached a definitive agreement to acquire Cuming-Lehman Chambers's subsidiary Cuming Microwave. Cuming Microwave supplies specialty coatings and materials that are used in electronics, telecommunications, medical and automotive segments.

PPG Industries, Inc. (PPG) is a global supplier of protective and decorative coatings. Performance Coatings, Industrial Coatings and Architectural Coatings- EMEA segments supply protective and decorative finishes for customers in a range of end use markets, including industrial equipment, appliances and packaging; factory-finished aluminum extrusions and steel and aluminum. Founded in 1883, PPG has global headquarters in Pittsburgh and operates in nearly 70 countries around the world. Reported net sales in 2014 were USD15.4 billion.

IVC, based in Brazil, Indiana, focuses on the development, manufacture and sale of powder and liquid coatings for the general industrial segment. Its industry-leading coatings are used on a wide variety of products, including metal office furniture, material handling and storage products, automotive parts, motorcycles, industrial containers, small appliances and electronics such as printers, servers and audio-visual equipment. IVC employs more than 300 people and operates five plants in the U.S. (two in Brazil, Indiana, and one each in Grand Haven, Michigan; Atlanta, Georgia; and Casa Grande, Arizona), one plant in Guangdong, China, and a small development lab in Manchester, England. The company also has operations in Malaysia through a joint venture.

MRC

MOSCOW (MRC) -- Brazilian petrochemical company Braskem SA said on Tuesday it was finalizing a short-term extension of its contract to buy naphtha from state-run oil company Petrobras, avoiding an interruption to operations, said Reuters.

The contract has been under intense scrutiny after prosecutors charged executives at engineering group Odebrecht SA, Braskem's biggest shareholder, with paying bribes to Petrobras executives to secure naphtha at a price that allegedly cost the oil giant billions of dollars.

Braskem and Odebrecht have denied any wrongdoing, but Petrobras, Braskem's second-largest shareholder, confirmed irregularities in the process of approving the 2009 contract.

Naphtha is the main raw material for many of Braskem's plastic resins and other chemical products.

As MRC informed earlier, Petrobras said it has identified "irregularities" in the 2009 naphtha supply contract with local petrochemicals company Braskem, a sign that a widespread bribery scandal may have tainted the deal.

Braskem is Brazilian main producer of polyethylene and polypropylene. In addition with ongoing plants located in both petrochemical complexes, in April 2008 Braskem opened a 300,000 metric ton polypropylene plant in the city of Paulinia (Sao Paulo).
MRC

MOSCOW (MRC) -- Milacron Holdings Corp. has completed an expansion at its Mold-Masters’ hot-runner plant in India, said Plasticsnews.

Mold-Masters finished the expansion in the second quarter, to serve what company officials said is a rapidly growing market in India. The 10,000-square-foot facility in Chinnavedampati, Coimbatore, is just two-and-a-half miles from the existing manufacturing facility and about five miles from Mold-Masters’ head office in Saibaba Colony.

According to Milacron, the plant will mainly manufacture Mold-Masters hot runner systems for automotive and large parts — the Fusion G2. The G2 product line is engineered in Europe. It features a drop-in, single-point connection design for easy installation, faster start-ups, reliability and user-friendly maintenance for automotive and medium to large part molding applications, Milacron officials said.

Milacron will feature the Fusion G2 hot-runner system at the upcoming Fakuma 2015 show in Friedrichshafen, Germany, Oct. 13-17. Kannan Venkatraman, Mold-Masters’ managing director, India, hosted a grand opening. Hans Hagelstein, Mold-Masters’ vice president and general manager for Europe, Middle East, Africa, and India, also performed the ribbon cutting ceremony to officially open the facility.

"As India’s injection molding market continues to grow, so too will the complexity of the molded products the region produces,” Hagelstein said. “With complex products come increasingly complex molds and an increased reliance on hot runners, which is where Milacron’s Mold-Masters brand excels."

Milacron’s team in Coimbatore has grown from a small group to more than 350 employees today.

As MRC informed earlier, Milacron LLC is planning to move its Cincinnati, Ohio-area headquarters from Oakley to the neighborhood of Blue Ash.

Milacron is a limited liability company that manufactures and distributes plastic processing equipment for fields such as injection molding, extrusion molding, and metal injection molding.

MRC

MOSCOW (MRC) -- USI Group eyes to shut its high density polyethylene (HDPE)/linear low density polyethylene (LLDPE) swing plant, according to Apic-online.

A Polymerupdate source in Taiwan informed that the company plans to take its swing plant offstream owing to sluggish demand fundamentals. The plant is likely to shut in October 2015 for a period of around 15 days.

Located in Kaohsiung, Taiwan, the plant has a production capacity of 160,000 mt/year.

As MRC informed before, in end-June 2015, USI Group shut its HDPE/LLDPE plant owing to weak demand fundamentals. It was restarted in mid-July 2015.

Besides, we remind that, in mid-June 2015, PTT Global Chemical (PTTGC), Thailand's largest petrochemical maker, shut its HDPE plant for maintenance turnaround. It remained off-stream for around 2 weeks. Located at Map Ta Phut in Thailand, the plant has a production capacity of 300,000 mt/year.
MRC