Business Concentrates

Nine people died and 150,000 were temporarily evacuated following explosions at a leaking chlor-alkali plant in a densely populated part of Chongqing, southwestern China, on April 15. Authorities were alerted to problems at the plant following an initial explosion. Rescue workers entered the site but withdrew a few hours later, just before a larger explosion that created a yellow cloud. Two days after the explosions, authorities decided to stop the leak by blowing up three remaining chlorine tanks with armor-piercing shells fired from a military tank. Miao Guang Kui, director of the rescue team, told the Xinhua News Agency that the accident occurred after plant workers started to pump chlorine out of tanks that were leaking. This led to a rise of temperature inside the tanks and the explosion of five of them, Miao said. The factory, Chongqing Tianyuan Chemical, is an old complex that employs 4,000 people and is part of the state-owned Chongqing Chemical & Pharmaceutical Holding Group. In an interview with C&EN last month, Miao, who is also the chairman of CCPHG, said that some managers in his group of companies were unprofessional. He also acknowledged that several of the plants were old and located too close to population centers (C&EN, March 29, page 14).

Misschem's corporate fission

Mississippi Chemical wants to split into two separate companies, according to a plan of reorganization submitted to U.S. Bankruptcy Court. "New Misschem" will own all of Mississippi Chemical's U.S. operations. "Old Misschem" will get the firm's ammonia operations in Trinidad and Tobago. DDJ Capital Management and Delaware Street Capital would provide $70.0 million to Old Misschem and $64.5 million to New Misschem. The two investment firms would take a 60% stake in the overseas company. New Misschem would get $30 million to $45 million worth of new stock issued by the offshore firm. Unsecured creditors, including holders of about $225 million in bonds, would get full ownership of New Misschem. Judge Edward Ellington has not yet set a hearing date for the plan.

PQ readies site in China

PQ Corp. has acquired 24 acres of land-use rights in China's Tiajin Economic Development Area for the purpose of building a number of inorganic chemical plants. The company says the initial project will be a sodium silicate factory with annual capacity for 40,000 metric tons of product on a glass basis. The plant is expected to open early next year. Several other projects intended for the site are in the planning stage, PQ says.

Swan is making carbon nanotubes

Thomas Swan & Co. has opened what it calls the U.K.'s first commercial plant for high-purity single-wall carbon nanotubes. The plant, in Consett, England, uses a chemical vapor deposition process that is the result of a collaboration with Cambridge University. Company Chairman Tom Swan says the new plant is a step toward developing new products--"from lighter, fuel-efficient planes to conductive plastics that are stronger than metal."

Nano stock index revised

Merrill Lynch has revised its Nanotech Index after it came under fire from Wall Street firm Asensio & Co., which charged that the index touted nearly worthless companies (C&EN, April 19, page 8). Merrill Lynch dropped six companies on the index and added three. It also said it would make other changes, based on investor and company feedback, so the index would be more objective. Still included is at least one company, NVE, that Asensio contends has nothing to do with the nanotechnology business. The index is not a tradable security, but it is listed on the American Stock Exchange under the symbol NNZ.

Acetex forms Saudi venture

Acetex Corp. has agreed to form a joint venture with Saudi Arabia's Tasnee Petrochemicals, an affiliate of National Petrochemical Industrialization Co., to build a $1 billion petrochemical complex. The complex will have the capacity for 500,000 metric tons of acetic acid, 275,000 tons of vinyl acetate, and 1.8 million tons of methanol per year and is expected to be completed by 2007. Under the agreement, Acetex will own 50% of the acetyls plants and 25% of the methanol unit. The plants will be based on Acetex technology that produces both acetic acid and methanol, generating an estimated construction savings of $100 million. Canada-based Acetex is the second largest producer of acetic acid in Europe after BP. With the new investment, the company hopes to become the lowest cost producer of acetyls in the European and Asian markets. "These projects fit well with our long-term growth strategy of becoming a global chemical company," says CEO Brooke N. Wade.

Eco-investment report is critical of Dow Chemical

Innovest Strategic Value Advisors, a research firm that analyzes companies on social and environmental performance, issued a report last week claiming that Dow Chemical hasn't disclosed the magnitude of the investment risks associated with Union Carbide's 1984 disaster in Bhopal, India; the dioxin linked to organochlorine chemicals; Agent Orange defoliant-related lawsuits; chemical effects on semiconductor workers; asbestos claims; and other such issues. "The combined impact of these developments implies that the firm has above-average risk exposure," the report said. Innovest says the report was prepared on behalf of the environmental group Ecology Center in partnership with financial institutions and religious investors. Dow says it views the report as "issues advocacy and not an objective financial assessment."

Martek, DSM extend pact

Martek Biosciences has extended a 1997 agreement with DSM Food Specialties involving production of arachidonic acid (ARA), a long-chain fatty acid that, in combination with docosahexenoic acid (DHA), is said to support infant brain development. Under the new deal, DSM will increase its ARA capacity in the Netherlands and the two firms will share technology. Last year, Martek acquired FermPro Manufacturing in order to boost ARA and DHA output.

Output up again in March

U.S. chemical production increased in March for the third straight month, according to seasonally adjusted data from the Federal Reserve Board. Output of all chemicals rose 0.4% from February to an index of 109.6 (1997 = 100). The index was up 4.4% from March 2003. Basic chemical production declined a slight 0.1% from February, but was up 1.8% from the same month a year earlier to 95.1. The government's estimate of seasonally adjusted capacity utilization for all chemicals rose to 75.4% from 75.2% in February and 73.1% in March 2003.

Air Products buys and sells

Air Products has acquired Precision Purification Services, a Dallas-based provider of parts-cleaning services to the semiconductor industry. Air Products says the purchase will complement its existing sites in Carrollton, Texas, and Phoenix. Separately, Air Products is selling its European methylamines and derivatives business to Taminco. Taminco was formed last year through a management-led buyout of UCB's methylamines business.

Elementis buys Sasol's Servo

Elementis will acquire Sasol's specialty surfactants subsidiary, Servo, for approximately $54 million. Elementis anticipates that Servo will complement its operations in rheology and surface chemical additives while bringing manufacturing capacity via a plant in Delden, the Netherlands. Servo's sales in its last fiscal year were just under $130 million; Elementis' were roughly $660 million.

Rhodia sells more assets

Rhodia is continuing its slimming program with the sale of several more businesses. The company will sell its 50% stake in the Chilean carrageenan joint venture Extractos Naturales Gelymar to its Chilean partners, Oxiquim and Algina Chemical Products. Gelymar had sales of $16.9 million last year. Rhodia is also selling its $85 million European specialty phosphates business to Thermphos International and its research property near Paris to a local real estate company. Combined with earlier sales, the deals are expected to raise about $500 million by June.

Dowpharma in deal with BMS

Dow Chemical's Dowpharma services unit and Bristol-Myers Squibb have signed an agreement under which Dowpharma will determine whether its BioAqueous solubilization technology can advance the development of unspecified BMS drug candidates. The agreement includes funding for feasibility studies and provides for milestone and royalty payments as compounds progress through development. The BioAqueous unit offers technologies for altering compound particle size, surface area, or morphology in order to improve a drug's ability to dissolve in the body.

Novartis and Aventis talk

Novartis said at its annual meeting last week that it has begun talks with Aventis regarding a possible business combination. Novartis has been seen as a potential white knight for Aventis in the face of a hostile takeover bid from Aventis' French compatriot Sanofi-Synthélabo. Switzerland-based Novartis had said it wouldn't interfere with the takeover because it was endorsed by the French government, but Novartis Chief Financial Officer Raymund Breu told reporters last week that French officials have indicated that they will not try to block a possible Novartis bid for Aventis.

BUSINESS ROUNDUP

• Schenectady International has acquired the phenolic resins and paper additives business of Atofina's CECA unit, including a plant in Ribécourt, France. Schenectady has also acquired Great Lakes Chemical's Newport, Tenn., plant, which it will renovate and put to new use.

• Diosynth Biotechnology, an Akzo Nobel unit, will manufacture clinical trial quantities of NeoPharm's interleukin-13-PE38QQR, an anticancer drug. The compound has fast-track development status from FDA.

• Konarka Technologies and Oak Ridge National Laboratory are collaborating to develop Konarka's polymer photovoltaic products. Under a new pact, Konarka is ORNL's exclusive R&D partner for chemistry related to solar cells.

• Polysciences has acquired Dream Cosmetics, a contract manufacturer for the cosmetics industry. Polysciences says the combination will form a full-line supplier to personal care firms.

• Finland's Dynea Chemicals and Russia's JSC Metafrax have formed a venture to make wood adhesive resins. The venture is building a 200,000-metric-ton-per-year plant in Russia's Perm region that will open in the third quarter. A second plant is planned for 2006.

• Dutch-based Jo Tankers will plead guilty and pay a $19.5 million fine to the Department of Justice for fixing prices on international shipments of chemicals. In October, Odfjell Seachem pleaded guilty to similar charges and paid a $42.5 million fine.