WACKER to acquire Air Products' stake in construction polymers joint ventures
Munich / Lehigh Valley (PA) (euro adhoc) -
- Integrated value chain further strengthened - Increase in polymer sales to approx. 1 billion in 2008 - Another logical step in the Groups growth strategy, says WACKER CEO
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December 11, 2007 - Wacker Chemie AG plans to acquire full ownership of Air Products Polymers (APP) and Wacker Polymer Systems (WPS), its two joint ventures with Air Products and Chemicals, Inc. The two partners today announced they have signed an agreement to this effect. As the world's leading supplier of dispersible polymer powders for construction applications, WACKER expects that the acquisition will provide strategic advantages to its global construction-polymers business. Benefits include synergies and cost advantages stemming from backward integration at U.S. and Asian dispersion plants, as well as the expansion of its supply chain outside the eurozone.
The closing of the transaction, which is subject to approval by the relevant antitrust authorities, is expected in Q1 2008. As part of the agreement, WACKER retains the Vinyl Acetate Ethylene (VAE) activities of the Joint Venture, while Air Products will receive full ownership in the Elkton, Md., and Piedmont, S.C., production facilities and their related businesses plus cash considerations of USD 265 million. With approval, the transaction would contribute substantially to further develop WACKER´s polymer business to around EUR1 billion in sales in 2008.
Air Products issued a formal statement back in March 2006, announcing its intention to sell its APP and WPS shareholdings. Currently, WACKER owns 35 percent and Air Products 65 percent of APP. As for WPS, WACKER holds 80 percent and Air Products, 20 percent.
The planned acquisition focuses on the activities of APP and WPS in vinyl acetate ethylene-based dispersions and dispersible polymer powders. Consequently, WACKER plans to acquire all of the two companies´ related activities at their APP and WPS sites in Allentown (PA, USA), Calvert City (KY, USA), Cologne and Burghausen (Germany), South Brunswick (NJ, USA) and Ulsan (Korea). WACKER intends to continue operating this business out of the Lehigh Valley. The Elkton (MD, USA) and Piedmont (SC, USA) sites and the associated businesses will become fully owned by Air Products.
Wacker Chemie AG´s CEO, Peter-Alexander Wacker, saw the acquisition as another logical step in the Group´s growth strategy. "WACKER and Air Products have worked together for over 20 years successfully developing the polymers market. This is a very capable and knowledgeable team," he said. "Our agreement will give WACKER fully integrated production sites in the USA and Asia. The economies of scale and synergies resulting from this extension of our value chain will bring us cost advantages. By boosting WACKER´s polymer sales, the agreement reinforces the balance of our entire business portfolio. We will push ahead now with APP´s and WPS´s integration into WACKER Group."
Air Products´ President and CEO, John McGlade, said: "Air Products and WACKER are looking back to a decades-long successful partnership in polymer business. They recognize the strategic value of the business, its high quality assets and its outstanding team of employees."
APP and WPS in Brief Air Products Polymers (APP) produces polymer dispersions at sites in Germany, South Korea and the USA. It sells its products under the Airflex®, Vinac®, Flexbond® and Flexcryl® trademarks to industries ranging from adhesives, nonwovens, paints and coatings, to building products, paper, carpet and textiles. Wacker Polymer Systems (WPS) is responsible for VINNAPAS® dispersible polymer powders, VINNAPAS® solid resins, PIOLOFORM® B, VINNOL® surface-coating resins, VINNEX® binder systems and VINNAPAS® dispersions for construction applications. WPS operates production facilities in Germany, China and the USA.
Air Products in Brief Air Products (NYSE: APD) serves customers in industrial, energy, technology and healthcare markets worldwide with a unique portfolio of atmospheric gases, process and specialty gases, performance materials, and equipment and services. Founded in 1940, Air Products has built leading positions in key growth markets such as semiconductor materials, refinery hydrogen, home healthcare services, natural gas liquefaction, and advanced coatings and adhesives. The company is recognized for its innovative culture, operational excellence and commitment to safety and the environment. Air Products has annual revenues of $10 billion, operations in over 40 countries, and 22,000 employees around the globe. For more information, visit www.airproducts.com.
WACKER in Brief WACKER (www.wacker.com) is a globally active chemical company headquartered in Munich. With a wide range of state-of-the-art specialty products, WACKER is a leader in numerous industrial sectors. Its products are required in countless high-growth end-user sectors such as photovoltaics, electronics, pharmaceuticals and household/personal care. WACKER POLYMERS is currently the global leader in dispersible polymer powders for construction applications. In 2006, the WACKER Group posted sales of some EUR3.34 billion, with approx. 80 percent being earned outside Germany. WACKER currently employs about 14,700 persons at 22 production sites in Europe, the Americas and Asia and in some 100 sales offices worldwide. Wacker Chemie AG is listed on the Frankfurt (Germany) Stock Exchange (ISIN: DE000WCH8881).
This press release contains forward-looking statements based on assumptions and estimates of the executive boards of WACKER and Air Products. Although we assume the expectations in these forward-looking statements are realistic, we cannot guarantee they will prove to be correct. The assumptions may harbor risks and uncertainties that may cause the actual figures to differ considerably from the forward-looking statements. Factors that may cause such discrepancies include, among other things, changes in the economic and business environment, variations in exchange and interest rates, the introduction of competing products, lack of acceptance for new products or services, and changes in corporate strategy. WACKER and / or Air Products do not plan to update the forward-looking statements, nor do they assume the obligation to do so.
end of announcement euro adhoc 11.12.2007 06:59:14
Further inquiry note:
Wacker Chemie AG
Corporate Communications
Christof Bachmair
Tel.: +49 (0) 89 6279-1830
E-Mail: christof.bachmair@wacker.com
Air Products and Chemicals, Inc.
Corporate Communications
Robert F. Brown
Tel. +1 610-481-1192
E-Mail: brownrf@airproducts.com
Branche: Chemicals
ISIN: DE000WCH8881
WKN: WCH888
Index: CDAX, Classic All Share, HDAX, MDAX, Midcap Market Index,
Prime All Share
Börsen: Börse Frankfurt / regulated dealing/prime standard