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Business

Business Concentrates

April 25, 2005 | A version of this story appeared in Volume 83, Issue 17

Pharmaceutical rice pact

A last-minute compromise will allow start-up firm Ventria Bioscience to go ahead with a planting of genetically altered rice in Missouri. Gov. Matt Blunt and Sen. Christopher S. (Kit) Bond (R-Mo.) helped work out a compromise after beer maker Anheuser-Busch announced that it would not buy rice grown or processed in Missouri if Ventria went ahead and planted 200 acres of rice altered to produce pharmaceuticals just seven miles away from food-grade rice fields. Vertria has a pending permit to grow the rice with the U.S. Department of Agriculture. Under the agreement, Ventria would plant its rice, engineered to produce the human proteins lactoferrin and lysozyme, in fields at least 120 miles away from other rice fields. The company says the proteins help boost the human immune system. Though rice is self-pollinating, critics fear cross-contamination through flooding, human error, birds, or insects. For its part, Anheuser Busch agreed to continue to buy rice grown in Missouri, the sixth largest rice-producing state. The rice is used to brew beer. Ventria is in the process of moving from Sacramento, Calif., to Maryville, Mo., in a business incubator building managed by Northwest Missouri State University. The university hopes to become a research center for plant-made pharmaceutical production. Its president, Dean L. Hubbard, is on Ventria's board of directors.

Novozymes, DOE claim cost cut

Novozymes and the Department of Energy's National Renewable Energy Laboratory concluded a biomass-to-ethanol research project that claims a 30-fold reduction in the cost of enzymes needed to convert cellulose into sugars for the production of biomass ethanol. The partners spent $17 million over four years to cut the price of cellulose from more than $5.00 to less than 20 cents per gal of ethanol. Ethanol maker Abengoa Bioenergy says it will start testing Novozymes' enzymes next year at its biomass pilot plant in York, Neb.

Merszei rejoins Dow as CFO

Merszei
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Credit: DOW PHOTO
Credit: DOW PHOTO

Geoffery E. Merszei, 53, will replace J. Pedro Reinhard, 59, as chief financial officer of Dow Chemical on Oct. 1. Dow's policy says an executive who also serves on the board of directors must retire from the executive position upon turning 60 years of age. Merszei, the son of former Dow CEO Zoltan Merszei, worked at Dow for 24 years, reaching the position of vice president and treasurer, before he left in September 2001. He then served as CFO of Alcan. He will become an executive vice president of Dow on July 1.

Lanxess mulls partnerships

On the heels of its decision to close unprofitable plants in fine chemicals and styrenics, Lanxess is considering strategic partnerships for its paper chemicals business unit. It has retained the Swiss investment bank UBS Group to evaluate the business to see if more value can be added by formation of strategic partnerships. The firm's paper chemicals business employs about 350 people and runs plants in Leverkusen, Germany, and Bushy Park, S.C. However, it may be sold. According to press reports in Scandinavia, Kemira is in preliminary talks to purchase the unit from Lanxess.

Koppers buys specialties

A U.K. subsidiary of Koppers has agreed to acquire, for an undisclosed sum, the business and assets of Lambson Speciality Chemicals, a subsidiary of British specialties producer Lambson Group. Lambson, a privately held company, had total sales last year of about $56 million. Its specialty chemicals arm focuses on mineral acids and alkalis, as well as recovery and regeneration services for acids, glycerine, ammonia, and caustic soda. According to Koppers, the purchase is in part a diversification of its carbon materials and chemicals division. Lambson's specialty chemicals operations and production will be relocated to Kopper's Port Clarence site in northeast England, and the resulting new business will be called Koppers Lambson.

J&J to buy Peninsula

Johnson & Johnson announced an agreement under which its Ortho-McNeil Pharmaceutical subsidiary would acquire Peninsula Pharmaceuticals, a privately held biopharmaceutical company focused on developing and commercializing antibiotics for infectious diseases, in a deal valued at $245 million. Peninsula's lead product candidate, doripenem, is a broad-spectrum ß-lactam antibiotic. Prior to completing the acquisition, Peninsula plans to spin off its PPI-0903, a fifth-generation broad-spectrum cephalosporin, into a new company called Cerexa that will not be acquired by J&J.

DSM to boost diaminobutane

DSM Engineering Plastics is to increase by 65% the capacity of its diaminobutane production at its site in Geleen, the Netherlands. The increase will provide additional feedstock for an existing plant and a new plant to be built to make Stanyl, DSM's high-temperature nylon 4,6 high-performance engineering plastic. The first phase of the basic engineering for the diaminobutane plant, which will be handled by Norwegian engineering firm Aker Kvaerner, is slated for completion in the third quarter of this year.

Bidder protests hydrazine contract

The Department of Defense has notified Arch Chemicals that a competing bidder has protested last month's award of a $149 million, 20-year contract to Arch for the production and handling of hydrazine rocket propellant starting in 2007, according to an announcement by Arch. The protesting bidder is not identified in the announcement. A $159 million contract for the project had been awarded last year to SpaceChem, a division of Santa Maria, Calif.-based United Paradyne. Arch, which currently supplies the fuel, contested the original award, and bidding was reopened last July.

Dow Corning, Daikin set R&D

Dow Corning and Japan's Daikin Industries, which consider themselves respective leaders in silicon and fluorine chemistry, will collaborate to explore new areas of fluorosilicone chemistry. According to Naoki Toyoshima, deputy general manager of Daikin's chemical division, fluorine bonds with other elements to create compounds that are resistant to heat and chemicals. "Silicone gives fluorocarbons softness, flexibility, low-temperature resistance, better adherence to substrates, and other properties they did not have before," he adds.

Sarnia blackout sidelines Nova

An external power disruption shut down Nova's ethylene and polyethylene plants in Sarnia, Ontario, on April 16. The company says the units will take about a week to restart and will be back at full rates in about a month. Nova says the shutdown will drag down earnings by approximately $20 million to $25 million after taxes. Local power authorities are investigating the cause of the blackout.

Bayer signs agchem pacts

Bayer CropScience has set two multiyear supply contracts for its imidacloprid insecticide. One agreement, with Cheminova, aims at expanding the market for imidacloprid by drawing on the strength of the firms' respective distribution channels. Cheminova is a subsidiary of Auriga Industries, a Danish fine chemicals maker. Bayer's other contract for imidacloprid is with Israel's Makhteshim Agan Industries, which describes itself as the world's leading generic manufacturer in the agrochemicals market. Both agreements exclude animal health applications.

AIRLIFT
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Credit: BASF PHOTO
Polyacrylate gels hold large volumes of water to fight fires.
Credit: BASF PHOTO
Polyacrylate gels hold large volumes of water to fight fires.

Superabsorbentfights fire

The stuff that makes diapers so effective is now being used to fight fires. BASF has introduced acrylic superabsorbents to fight forest and brush fires. The firefighting gel can be dispensed through hoses or from helicopters and airplanes. Astaris, a joint venture of Solutia and FMC, is distributing the superabsorbent, known as Phos-Chek AquaGel.

Wacker plans new facilities

Wacker-Chemie announced expansions in silicon chemistry and biologics at its annual press conference in Munich last week. The firm said it will spend some $260 million to add 2,500 metric tons of polysilicon capacity at its plant in Burghausen, Germany. Together with an expansion already under way, capacity will rise to 9,000 metric tons per year by 2007 from 5,000 metric tons today. The company says it is responding to demand from the solar cell industry. In biologics, the firm is considering construction of a large-scale fermentation facility in Germany that would cost $65 million. The firm boosted its presence in biologics earlier this year with the acquisition of the German firm ProThera.

European petrochemicals merger

The European Commission has approved the acquisition of the Czech petroleum and chemicals producer Unipetrol by PKN Orlen, of Poland. The activities of the two companies "did not overlap to a significant extent," the commission concluded. PKN, formerly government owned but now a public company, is active in crude-oil processing and the production of petroleum and petrochemical products. Unipetrol is active in petrochemicals, fertilizers, and plastics, as well as petroleum products. The deal is seen as leading to the creation of a large regional player in the oil and petrochemicals sectors, although it remains of limited size compared with its main competitors, the multinational oil companies, the commission noted. PKN is obligated to offer to buy out minority shareholders after it completes the purchase of the 63% stake now held by the Czech government.

BUSINESS ROUNDUP

The Synthetic Organic Chemical Manufacturers Association says it is exploring the option of selling Informex, its annual U.S. trade show, or forming an alliance with a trade show management company to handle the event, which is scheduled to be held in New Orleans next February.  

Jazz Pharmaceuticals plans to purchase Orphan Medical in a stock deal valued at $145 million. Jazz hopes to expand its product line in neurological and psychiatric therapies. Orphan's lead product, Xyrem (sodium oxybate), is a sleeping disorder therapy.

DSM will license Genomatica's SimPheny modeling technology for research in areas such as microbial strain engineering and process development. The firms will also jointly develop a metabolic model of a key DSM production organism.  

BASF has completed the acquisition of the electronic chemicals business of Germany's Merck, following approval by antitrust authorities. In addition,BASF plans to buy back nearly $2 billion of its stock beginning this month. Since BASF first began a buyback program in 1999, it has spent about $5.4 billion to retire roughly 16.4% of the share capital that was outstanding at the end of 1998.  

Terra Industries, CF Industries, and ANSA McAL are studying the construction of a world-scale ammonia and urea ammonium nitrate facility in Trinidad & Tobago. The engineering firm Uhde will develop an estimate of the project's cost.

FMC plans to close a pesticide formulating plant in Opelousas, La., and move operations to an existing plant in Wyoming, Ill. About 45 jobs will be lost at the plant, which turns out about 50 million lb of granular products each year.  

Agrium is spending $40 million to expand capacity for its controlled-release nitrogen fertilizer products. By next January, capacity for its ESN (Smart Nitrogen) product will increase to 150,000 metric tons per year, and its Duration CR (controlled-release) product will increase to 40,000 metric tons.

 

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