Chemical industry weekly news roundup, 7 March
10:37 AM MST | March 7, 2014 | By LINDSAY FROST
This Week in CW:
Shin-Etsu (Tokyo) is studying plans to build a world-scale ethylene plant in the United States, executive chairman Chihiro Kanagawa tells CW. Ethylene capacity would be 1 million m.t./year and the company is in preliminary discussions with technology suppliers, Kanagawa says. There is a “much more than 50%” chance that the company will decide in favor of building a US cracker, he adds. The company expects to make a final decision in 6-12 months. Site locations are under evaluation but the company is leaning toward Louisiana. “Plaquemine would be the most probable location,” Kanagawa says. “Ideally, we want the plant next door to our downstream operations.” Shin-Etsu is the largest US and global maker of polyvinyl chloride (PVC) and currently purchases all of its US ethylene requirements under long-term contracts. Shin-Etsu’s current US PVC capacity is 2.65 million m.t./year, a roughly 34% share of US production.
Minerals Technologies (MTI) on 7 March submitted a $45/share bid for Amcol (Hoffman Estates, IL), raising the possibility of an intensified bidding war between it and Imerys for the bentonite and minerals producer. Amcol and Imerys agreed to a revised $42.75/share on Thursday, after MTI upped its ante with a $42.50/share bid early last week. Imerys first agreed to acquire Amcol, for $41/share, earlier in February. JP Morgan (New York) has signed a commitment to prove funding for the purchase price of the acquisition. Lazard (New York) and JP Morgan are acting as financial advisers to MTI on the deal. MTI says it can extract $50 million in near-term cost savings from Amcol, and “expects to deliver more over time” through combined technology platforms, overlapping markets and MTI’s operational management approach.
The European Commission has, as expected, opened an in-depth investigation to assess whether the planned acquisition by Huntsman of a number of titanium dioxide (TiO2) assets from Rockwood is in line with EU merger regulations. The decision to open an in-depth inquiry does not prejudge the result of the investigation, the commission says. It now has 90 working days—until 22 July— to take a decision. Huntsman plans to acquire Sachtleben (Duisburg, Germany), Rockwood's TiO2 and functional additives division. It also plans to buy from Rockwood businesses in color pigments, timber treatments, wood protection chemicals, and water treatment chemicals; and Gomet (Azeglio, Italy), a specialist provider of rubber automotive spare parts. The deal was approved in the United States in December, as reported by CW.
Taminco announced today it completed, 23 December 2013, the previously announced acquisition of Kemeria Oyj’s formic acid business, including the feed and the airport runway deicing product lines at Oulu, Finland, and approximately 160 employees, for $191.5 million. The business serves a number of markets, including animal nutrition, agriculture, water treatment, and energy. Kemira says it reports a capital gain of approximately €40 million ($50.4 million) related to the transaction in first-quarter 2014. The remaining businesses within the ChemSolutions segment, including sodium precarbonate, will stay with Kemira in its paper segment, and the ChemSolutions segment will be discontinued in the quarter.
Around the Web:
US job growth accelerated sharply in February despite the icy weather that gripped much of the nation, easing fears of an abrupt economic slowdown and keeping the Federal Reserve on track to continue reducing its monetary stimulus, according to Reuters. Employers added 175,000 jobs to their payrolls last month after creating 129,000 new positions in January, the Labor Department said on Friday. The unemployment rate, however, rose to 6.7% from a five-year low of 6.6%, as Americans flooded into the labor market to search for work.
A newly discovered catalyst could lead to the low-cost, clean production of methanol, scientists say. Scientists have created a new nickel-gallium catalyst that could someday be used to convert hydrogen and carbon dioxide emissions into methanol, an important industrial chemical and potential fuel, according to Stanford news. Scientists from Stanford University, SLAC National Accelerator Laboratory and the Technical University of Denmark combined theory and experimentation to identify a new nickel-gallium catalyst that converts hydrogen and carbon dioxide into methanol with fewer side-products than the conventional catalyst. The results are published in the March 2 online edition of the journal Nature Chemistry.
According to Business Insider, in Warren Buffets new letter to Berkshire Hathaway shareholders, he comes out with specific advice for where the average investor should invest. Buffett effectively argues that it's wiser to invest in a boring index fund than it is to invest with people who try to beat the market. Note, Buffett's Berkshire Hathaway tries to beat the market, Insider writes. He says, “My advice to the trustee could not be more simple—put 10% of the cash in short-term government bonds and 90% in a very low-cost S&P 500 index fund. I believe the trust's long-term results from this policy will be superior to those attained by most investors—whether pension funds, institutions or individuals—who employ high-fee managers.”