Evonik sells superabsorbents business to ICIG

Evonik Industries AG said it has signed an agreement to sell its superabsorbents business to International Chemical Investors Group for an enterprise value in the low triple-digit million euro range, said the company.

The agreement also includes the assumption of pension obligations by ICIG, the company said. The final transfer of the business is planned for mid-2024 following approval by the relevant competition authorities, it said.

Evonik’s superabsorbents business generated sales of €892 million in 2023, with adjusted EBITDA in the mid double-digit million-euro range. On average over the past five years, it achieved an adjusted EBITDA of around €20 million, the company said.

ICIG is taking over the entire business with around 1,000 employees and superabsorber production facilities at Krefeld and Rheinmuenster, Germany, as well as two locations in the US; in Greensboro, North Carolina, and Garyville, Louisiana. The business also includes plants at Marl, Germany, for production of acrylic acid, the most important raw material for superabsorbents, Evonik said.

Christian Kullmann, chairman of Evonik said that the profile of the superabsorbents business no longer fits Evonik’s character as a specialty chemicals company. This agreement is “the second step in the divestment of our performance materials division,” he said.

The first step was the sale of Evonik’s Luelsdorf site and associated businesses in Wesseling to ICIG last year. The third part of the performance materials division are chemicals from the C4 chain, which is a business that is up for sale too, the company said.

Kullmann said earlier today, during a press conference about the company’s 2023 results, that Evonik will not rush the sale of its C4-chemicals business within the current environment, but will wait for the conditions to improve.

ICIG is an experienced chemical investor that has already announced extensive investments in the Luelsdorf site that it acquired in 2023. ICIG has a workforce of more than 6,200 that generates sales of over €4.6 billion per year.

”With its high technological quality as a new platform within ICIG, the superabsorbents business will offer our group new opportunities for further growth,” said Achim Riemann, chairman of the supervisory board of ICIG.

Superabsorbents are powdered polymers used as absorbent materials in diapers and other hygiene products.

We remind, Evonik Hydroxylterminated Polybutadienes Production CapacityEvonik, a specialty chemicals company, begins work to expand its POLYVEST® HT plant in Marl, Germany. The Coating & Adhesive Resins business line expects the additional production capacity for its hydroxyl-terminated polybutadienes (HTPB), marketed under the brand name POLYVEST®, to be ready as early as the second quarter of 2024 following the double-digit million-euro investment.

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A major investment project has been completed at AkzoNobel’s production plant in Bac Ninh province near Hanoi in Vietnam, which will help to strengthen the company’s position in Asia and sharpen its focus on more sustainable manufacturing, said the company.

Five new powder coating lines have been added at the multi-site, along with a line for producing water-based products for the consumer electronics market (IT, wireless and home appliances). The total investment amounts to €18.5 million.

“The cutting-edge powder coating lines we’ve installed will help us to grow with our customers, serve them faster and pave the way for a more sustainable future,” says Jeff Jirak, Managing Director of AkzoNobel’s Powder Coatings business.

“Increasing capacity at the site will enable us to focus on supporting volume growth in the northern part of the country, while our Dong Nai facility covers the southern part of Vietnam. It means we can now focus on streamlining our manufacturing processes to meet the diverse needs of the Vietnam market.”

The work included building a fully automated warehouse for the company’s consumer electronics activities, along with installing advanced equipment and technology to deliver higher productivity rates and efficiency gains. This will contribute to AkzoNobel’s ambition to halve its own carbon emissions by 2030. The installation of a new line for water-based consumer electronics products will also help to lower emissions across the value chain.

“We can now offer the latest water-based technology to our Vietnam-based multinational customers, including key Asian consumer electronic brands,” explains Maximilien Schreder, Global Director of AkzoNobel’s Consumer Electronics business. “This represents another important step forward in terms of helping to reduce the overall carbon footprint of our customers.”

Adding the new lines in Bac Ninh is the latest in a series of investments in the South Asia region, following recent capacity expansions in Pakistan, Thailand and Australia.

We remind, мore than 82 companies, businesses and social organizations – including AkzoNobel – are involved in a major Dutch research program focused on developing new technologies that will help solve some of today’s societal challenges. Seven broad consortia have been established as part of the government-funded “Perspectief” program, with AkzoNobel set to play a leading role in the SusInkCoat project, which will explore how to make inks and coatings more sustainable. AkzoNobel’s Como site is the company’s largest plant for producing powder coatings. It supplies products for seven main market segments: home appliances; architecture; automotive; agriculture and construction machinery; trade coaters; furniture; and general industry.

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Maire SpA (Milan) said its subsidiary NextChem has agreed a five-year deal with the Department of Energy of the Milan Polytechnic (Polimi) to collaborate on R&D for chemical and energy-transition catalysts, said the company.

NextChem and Polimi’s Laboratory of Catalysis and Catalytic Processes will work together to develop chemical reactor solutions and associated catalytic process modeling, with the aim of achieving improved results. Up to 90% of chemical processes occur using catalysts, according to Maire.

We remind, MAIRE announces that NEXTCHEM (Sustainable Technology Solutions), through its subsidiary NextChem Tech, has signed a contract with Paul Wurth S.A., a subsidiary of SMS group (‘Paul Wurth'), and Norsk e-Fuel AS for a licensing and engineering design package relating to NX CPO to be applied in the first industrial scale plant able to produce SAF from green hydrogen and biogenic CO2 in Mosjoen, Norway.

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Russia announced additional voluntary cuts in oil supply mainly in the form of production cuts rather than exports, as it faced curtailed refining capacity as well as stricter sanctions, said Hydrocarbonprocessing.

Russia has declared plans to cut its oil output and exports by an additional 471,000 bpd in April-June in coordination with some OPEC+ participating countries. While the world's second-largest oil exporter has been reducing 500,000 bpd in exports of crude oil and oil products in the first quarter, it has decided to scale down export limits in the second quarter and focus on production curbs instead.

Russia has suffered numerous outages and drone attacks at its large oil refineries since the start of the year amid the conflict with Ukraine. Among the oil processing plants which have reduced output are Rosneft-owned Tuapse, Lukoil’s Volgograd and NORSI refineries as well as Novatek's fuel processing and transhipment complex at the Baltic Sea port of Ust-Luga.

Maintenance at the NORSI oil refinery will likely take a few months, according to government officials. Adding to the oil glut will be seasonal maintenance work at Russian refineries in the spring and autumn. Fuel production during these months usually decreases, and crude oil exports increase.

Ronald Smith, a senior analyst with BCS brokerage in Moscow, said that Russia has little storage capacity for crude oil in order to be able to regulate exports. "I can only assume that a signal of oil output cuts relative to exports is indeed just a signal that the refinery repairs will take a few months, which is expected," he said.

Russia plans to gradually ease the export cuts, Russian Deputy Prime Minister Alexander Novak said in a statement on Sunday. In April, it will reduce output by an extra 350,000 bpd, with exports cut by 121,000 bpd. In May, the extra output cut will be 400,000 bpd and exports cut by 71,000 bpd. In June, all the additional cuts will be from oil output, he added.

Viktor Kurilov, a senior analyst at oil and gas consultancy Rystad Energy, said it was highly likely thаt the Middle Eastern partners asked for a bigger contribution of Russia to the OPEC+ production cut. Russia had revised up its oil exports for last month due to more available crude amid decreased refining capacity.

"The focus on production may also be related to the fact that there is volatility in the structure of Russian oil and oil product exports," he said. "Perhaps, therefore, it is not an effective practice to impose strict restrictions on oil and oil products exports under current conditions."

The West has also imposed wide-ranging sanctions against the Russian oil trade, while the United States also last month imposed sanctions on Moscow's leading tanker group Sovcomflot, further hampering Russian oil exports.

We remind, the European Chemical Industry Council (Cefic) said it sees the European Commission’s Strategy on Advanced Materials for Industrial Leadership as a pivotal step toward addressing the challenges posed by the green and digital transition, adding that the chemical industry has an important role to play as the primary source of advanced materials’ value chains.

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A new €26 million manufacturing plant with its own forest has been opened by AkzoNobel in Faisalabad – the company’s largest investment in Pakistan to date, said the company.

The 25-acre site, which has facilities for making decorative paint, wood finishes, automotive and specialty coatings, coil coatings and protective coatings, will help to meet increasing customer demand across a variety of markets.

Also incorporated into the Faisalabad location is a forest spanning an area of 5,450 square feet. More than 1,400 native trees and shrubs – planted using the Japanese Miyawaki gardening technique – are expected to grow into a flourishing self-sustaining ecosystem over the next two years.

“Our investment in this greenfield site reaffirms our commitment to grow in Pakistan,” says Mubbasher Omar, CEO of Akzo Nobel Pakistan Limited. “It will fuel our ambition to diversify with sustainable innovations and enter new segments in the domestic market, while also providing new opportunities to delight customers beyond Pakistan.”

The site, which employs nearly 200 people, has been constructed to comply with the company’s strict environmental standards and includes a series of sustainability features, such as renewable energy generation and energy efficient design.

“We’ve also integrated agile manufacturing to accommodate future expansion in production volumes, thereby allowing AkzoNobel to be more competitive in the market,” continues Omar. “It’s the next step in continuing to build on the company’s 60-year track record of delighting paints and coatings customers in Pakistan with world class solutions.”

The inauguration ceremony was attended by several guests of honor, including Ms. Henny de Vries, Ambassador of the Kingdom of the Netherlands in Pakistan.

We remind, AkzoNobel completes expansion of its largest powder coatings plant. A major capacity expansion has been completed at AkzoNobel’s Powder Coatings site in Como, Italy, which will help secure supply to customers across Europe, Middle East and Africa (EMEA), said the company. Four new manufacturing lines are now operational following the €21 million project – two of them dedicated to automotive primers and two to architectural coatings. New bonding equipment lines have also been added, ensuring that the products meet and exceed industry standards.

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