October 1, 2007

Volume 85, Number 40

pp. 21-22

Business Concentrates

DSM Steps Up Reshaping

A mid-term evaluation of its Vision 2010 strategic plan has led DSM to accelerate its shift toward life sciences products and performance materials. The company says it will maintain only those basic chemicals and polymer intermediates that it uses in its own production. As a result, DSM plans to divest itself of four businesses: melamine and urea, with estimated 2007 sales of $980 million; elastomers, with sales of $700 million; special products, $140 million; and maleic anhydride and derivatives, $105 million. These divestments will result in a reduced presence at the Chemelot chemicals complex, in Geleen, Netherlands, the company confirms, although it intends to invest in its R&D campus on this site. DSM also intends to find a partner for its citric acid business, with estimated 2007 sales of $175 million. The firm earlier stated its desire to partner its bulk antibiotics business. Among other new plans, DSM has earmarked almost $300 million for venture investments. Its latest is an equity investment in the Danish company Upfront Chromatography, which specializes in industrial protein chromatography processes. Separately, DSM will spend more than $40 million to build a plant in the Netherlands for waterborne emulsion resins.

Motiva Will Build Refining Capacity

Motiva Enterprises, a 50-50 joint venture between Shell Oil and Saudi Aramco, is expanding capacity at its Port Arthur, Texas, refinery by 325,000 barrels per day. The expansion will bring capacity at the complex to 600,000 bbl per day by 2010, making it the largest refinery in the U.S. The project, expected to cost up to $7 billion, will also increase output of propylene and other chemical feedstocks. Shell says the additional capacity is the equivalent of a new refinery, which the U.S. hasn't had in more than 30 years. Total U.S. refining capacity is roughly 18 million bbl per day.

Sinopec And DuPont Team Up For Resin

China Petroleum & Chemical (Sinopec) and DuPont have formed a joint venture to build and operate a plant producing ethylene vinyl acetate resins. The 60,000-metric-ton-per-year facility, expected to come on-line in late 2008, will be located within the municipality of Beijing at the site of Sinopec's subsidiary Beijing Yanshan Petrochemical. Sinopec will own a 55% stake in the venture and DuPont will own the remaining 45%.

Dow Invests In Gasification Firm

Dow Chemical and Citi Alternative Investments were the leaders in a recent $100 million round of financing for GreatPoint Energy. GreatPoint calls itself the leading developer of catalytic gasification technology for converting coal, petroleum coke, and biomass into natural gas. James H. Plonka, vice president of Dow Venture Capital, says GreatPoint's technology has the potential to help Dow diversify its supply of feedstocks and energy. GreatPoint intends to use the funds to build a large-scale demonstration facility.

Solutia Sees End To Its Bankruptcy

Solutia says it is poised to emerge from bankruptcy by the end of the year. The company, which entered bankruptcy in 2003 under the weight of pension and environmental liabilities, says it has reached a settlement with all the major constituents in its Chapter 11 case. Under the settlement, Solutia's former parent company, Monsanto, will take on financial responsibilities for tort litigation and environmental remediation. Solutia's Chief Financial Officer James M. Sullivan says he is confident the company can secure the necessary exit financing package despite recent turbulence in the debt market.

Syrgis Acquires Norac's Peroxides

Syrgis Performance Products has acquired Norac's organic peroxides business and renamed it Syrgis Performance Initiators. Syrgis says the deal includes facilities in Helena, Ark., and Sweden and adds about $50 million in annual sales. It calls Norac the number one North American producer of methyl ethyl ketone peroxides, used mainly to produce thermoset resins. Backed by the investment firm Edgewater Capital Partners, Syrgis has been assembling a family of autonomous specialty chemical firms.

Total Chooses Bioplastics Partner

Total Petrochemicals and lactic acid maker Galactic have agreed to form a joint venture, Futerro, that will develop polylactic acid-based plastics. PLA is a product of sugar fermentation and is used to make packaging resins and textile fibers. The two partners plan to construct a 1,500-metric-ton-per-year PLA pilot plant at Galactic's site near Tournai, Belgium, by 2009. Total Chemicals President Fran??ois Corn??lis told C&EN in May that Total, a maker of polyethylene and other large-volume plastics, wanted to get involved in PLA-based plastics. Galactic is owned by Belgium-based sugar refiner Finasucre and the holding company Bois Sauvage.

AmbioPharm Opens Peptide Facility

AmbioPharm, a newly formed pharmaceutical-grade peptide manufacturer, has opened in North Augusta, S.C., at a site acquired last year from UCB Bioproducts. Aiming to become the lowest-cost producer of peptide raw materials, building blocks, and active ingredients, AmbioPharm will manufacture in both North Augusta and Shanghai. The firm expects to create 50 new jobs over the next three years at the North Augusta site, which it says has room for expansion. Chris Bai, former CEO of American Peptide, is leading the new entity.

ChemDiv Partners With Russia, U.S.

ChemDiv's Chemical Diversity Research Institute is joining with the Blokhin Russian Oncology Center, the Department of Energy, and the National Cancer Institute to develop small-molecule therapies for prostate cancer. The partnership will operate under DOE's Global Initiatives for Proliferation Prevention Program, which is designed to identify and invest in high-tech resources in the former Soviet Union. The initial two-year partnership has received financial commitments of about $1 million.

Chemical Prices Fall In August

Overall U.S. chemical prices declined in August from the previous month, according to data from the Labor Department, largely on a plunge in the producer price index for basic industrial chemicals. The August index for all chemicals fell 1.1% from July to 215.3 (1982 = 100), although it was still 2.6% ahead of August last year. The index for industrial chemicals, meanwhile, dropped 4.5% from the previous month to 222.8. The August index for this sector increased, but by only 0.2%, from the same month in 2006.

Celgene Links With Array BioPharma

Celgene has linked up with Array BioPharma to discover and develop anticancer and anti-inflammation drugs. Array will receive a $40 million upfront payment in exchange for granting Celgene an option to choose drugs that are directed at two of four mutually selected targets. Array could gain up to $500 million in development and commercial milestones for each drug developed, as well as royalties on commercial sales. Celgene recently struck a similar arrangement with PTC Therapeutics, in which it made a $20 million equity investment in exchange for an exclusive option on two oncology targets for small-molecule drugs.

Bayer Will Add Polyols In Antwerp

Bayer MaterialScience plans to build a $56 million plant in Antwerp, Belgium, that can make up to 60,000 metric tons per year of polymer-filled polyether polyols. Bayer already produces polyether polyols, one of the starting materials, at the site. To open in late 2008, the facility will utilize a new process, developed with Bayer Technology Services, that promises to turn out product with low levels of volatile organic compounds. Construction costs and energy consumption for the new plant are expected to be reduced by 25%.

Sigma-Aldrich Hikes Fermentation Capacity

Sigma-Aldrich's SAFC fine chemicals business will spend $29 million to expand capacity at its fermentation facility in Jerusalem. The company says the project will enable SAFC Pharma to provide process development and drug-grade manufacturing to customers requiring large-scale, high-potency pharmaceutical ingredients. Scheduled for completion in the first quarter of 2009, the expansion will focus on secondary metabolites, cytotoxins, and therapeutic proteins made via bacterial and fungal fermentation, the company says.

BUSINESS ROUNDUP

Lonza is selling its purified isophthalic acid plant in Singapore to the Swedish company Perstorp for $138 million. The deal is expected to be completed by the end of the year.

The European Commission has cleared the acquisition of Finnish fertilizer producer Kemira GrowHow by Norwegian rival Yara, after the two parties agreed to address competition concerns in parts of Europe. Separately, the commission has extended its deadline for reviewing Schering-Plough's acquisition of Akzo Nobel's Organon BioSciences unit from Sept. 27 to Oct. 11.

Bayer MaterialScience and Bayer Technology Services will set up a catalysis research center in Aachen, Germany. Together, the Bayer companies will invest more than $10 million in the center, which will employ up to 12 researchers on the grounds of RWTH Aachen University. Local organizations will pitch in another $3.8 million.

Dow Chemical is selling its Ethafoam polyethylene foam business to Bubble Wrap maker Sealed Air for an undisclosed sum. The deal includes a process technology license, customer contracts, trademarks, and production equipment. Dow will make the products for Sealed Air for 18 months at facilities in Hanging Rock, Ohio, and Drusenheim, France.

Solvin, the joint venture of Solvay and BASF, will expand production of polyvinylidene chloride latex in Tavaux, France. The new production line will add annual capacity of 10,000 metric tons of the latex, a barrier material used as a coating in packaging applications.

Tronox says it won't sell its titanium dioxide plant in Uerdingen, Germany, as earlier proposed. Tronox says the offers it received didn't adequately value the facility.

Twin Rivers Technologies will add a new glycerin refinery and expand fatty acid capacity at its Quincy, Mass., oleochemicals facility. The company says the project will cost $13 million and be complete by May 2008. Twin Rivers was acquired by Malaysia's Felda Holdings earlier this year.

Polymer Technology Group, a supplier of polymers for medical devices, has created a life sciences incubator called Emergence. Along with outside investors, PTG says it will invest money and provide materials know-how to new medical device makers that locate in its Berkeley, Calif., facility.

Ablynx has received a $2.7 million grant from Belgium's Institute for the Promotion of Innovation by Science & Technology. Ablynx will use the grant to explore new drugs that exploit the properties of its Nanobodies therapeutic proteins, which are based on single-domain antibody fragments.

Chemical & Engineering News

ISSN 0009-2347

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