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Business

BUSINESS CONCENTRATES

June 6, 2005 | APPEARED IN VOLUME 83, ISSUE 23

Ineos plans big vinyl investment

Ineos, through its affiliate EVC, plans to invest nearly $1.25 billion in ethylene, chlor-alkali, and polyvinyl chloride plants at its site in Wilhelmshaven, near Hamburg, Germany. An agreement to embark on a $25 million preliminary study of the investment was reached late last month by Ineos CEO Jim Ratcliffe and Christian Wulff, prime minister of the German state of Lower Saxony. The study is expected to take about six months. If the project advances, it would include an ethane cracker, a chlorine electrolysis plant, and an expansion of EVC's existing vinyl chloride and PVC facilities at the site on Germany's North Sea coast. EVC would also build a 170-mile ethylene pipeline from Wilhelmshaven to Marl, in North Rhine Westphalia, the northern terminus of the northwestern European ethylene pipeline system. Subsequent investments by other companies would top $600 million, the parties predict. They say the project would safeguard 360 existing jobs, create 300 new jobs, and spur additional job creation. Wulff said the project would rank among the world's largest chemical investments.

Borden, Cytec conclude deals

Borden Chemical and Cytec Industries each completed deals last week--Borden becoming part of a new company, and Cytec selling its interest in a joint venture. Borden joined with Resolution Performance Products and Resolution Specialty Materials to form Hexion Specialty Chemicals, called the world's largest producer of thermosetting resins. Also included in the deal is Bakelite, which was acquired by Borden in April. In 2004, the firms that now make up Hexion had combined sales of about $4.2 billion. Meanwhile, Cytec has sold its 50% interest in acrylics producer Cyro Industries to its joint-venture partner Degussa for $95 million in cash.

Engelhard buys catalyst line

Engelhard has expanded its catalysts business with the acquisition of the synthesis gas catalyst unit of Nanjing Chemical Industry, a subsidiary of Sinopec. Though Engelhard won't say how much it paid for the business, a spokesman says the purchase includes manufacturing and R&D facilities in Nanjing that employ more than 600 people. Engelhard manufactures the cobalt catalyst for Sasol's Fischer-Tropsch slurry bed reactor, used to convert natural gas to synthetic diesel and petrochemical feedstock. The firm says the Nanjing Chemical business will extend its gas-to-liquids catalyst operation into the market for syngas used to make ammonia, hydrogen, methanol, and other products.

Scaminace to head OM Group

OM Group's hunt for a new president and CEO has turned up Joseph M. Scaminace, 52, who left his post last week as chief operating officer of paint maker Sherwin-Williams. He replaces James P. Mooney, 57, who stepped down in January after OM's board decided "the time is right for new leadership." The firm has seen tumultuous times, starting with its purchase, and quick subsequent sale to Umicore, of Degussa's precious-metals business in 2001. In March, OM settled class-action lawsuits over a stock-price decline that followed a 2002 earnings and restructuring announcement.

Polysciences goes in orbit

HELPING HAND
[+]Enlarge
Credit: NASA PHOTO
A NASA cell-growth experiment gets a blue tinge from polystyrene beads.
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Credit: NASA PHOTO
A NASA cell-growth experiment gets a blue tinge from polystyrene beads.

Blue-dyed polystyrene particles from the specialty chemical maker Polysciences are helping NASA scientists on board the International Space Station conduct cell biology and tissue engineering experiments. NASA is cultivating unique tissue constructs in the near-weightless environment of orbital space and needed to develop a precise mixing protocol for its bioreactor. Polysciences says its polystyrene beads were chosen because their 10-m size closely mimics the size and density of human lymphoid cells, the subject of the initial experiments.

Oryxe, Afton in fuel deal

Irvine, Calif.-based Oryxe Energy has signed a deal with Afton Chemical, the former Ethyl Corp. petroleum additives business, under which Afton will build a plant in Pasadena, Texas, to produce Oryxe's OR-LED diesel additive. The additive is intended to allow refiners to meet new Texas diesel standards set to go into effect later this year. According to Oryxe, the additive reduces nitrogen oxide emissions by 5.7%, hydrocarbon emissions by 20%, and carbon monoxide emissions by 10%. Chemical maker DSM supplies an ingredient to Oryxe and recently invested in the company (C&EN, May 16, page 15).

Honeywell waxes wane

Honeywell has completed the disposal of its industrial wax businesses with the sale of its U.S.-based wax operations to the International Group of Toronto. The transaction included facilities in Titusville and Farmers Valley, Pa., and one in Marshall, Texas. In April, Honeywell sold its European and Asian industrial wax operations to Netherlands-based Paramelt BV.

Arkema patent is affirmed

Arkema says the European Patent Office has confirmed the validity of a patent protecting the company's process for manufacturing the refrigerant difluoromethane after Honeywell challenged it. A U.S. patent is now the subject of litigation between Arkema and Great Lakes Chemical, a contract manufacturer of difluoromethane for Honeywell. A hydrofluorocarbon, difluoromethane is a major component in substitutes for chlorofluorocarbons being banned under the amendments to the Montreal protocol because they deplete upper atmospheric ozone.

Synthetic bio firm funded

Codon Devices of Cambridge, Mass., has secured series A, or first-round, venture-capital funding that it plans to devote to a range of synthetic biology applications. The firm's founding scientists are faculty members of Harvard, MIT, and University of California, Berkeley. Among the venture-capital backers are Flagship Ventures, Alloy Ventures, and Kleiner Perkins Caufield & Byers. The company sees opportunities in engineering cells that produce pharmaceuticals, engineered biotherapeutics, biosensors, and faster sequencing platforms for kilobase- to megabase-length genetic code.

Novartis signs drug deals in receptor field ...

Novartis has entered two license and development agreements for drugs that target Toll-like receptors, proteins considered gateways to immune modulation. Novartis has signed a pact with Anadys Pharmaceuticals to develop ANA975 and other Toll-like receptor 7 drugs for hepatitis B and C infections. Novartis will make an initial license payment of $20 million to Anadys and could make as much as $550 million in further milestone and other payments. With Hybridon, Novartis will develop Toll-like receptor 9 drug candidates targeting asthma and allergy. Hybridon could receive payments totaling $136 million plus royalties if Novartis elects to commercialize the candidates, which are based on Hybridon's immune modulatory oligonucleotide technology.

... and gets EC's nod on Hexal

The European Commission has cleared Novartis' proposed acquisition of Hexal, a German producer of generic medicines, and its U.S. sister company Eon Labs--but with conditions. To allay competition concerns, Novartis will sell off products in three major areas: prescription calcitonins, used to treat osteoporosis, in Poland; over-the-counter topical antirheumatics in Germany; and prescription antigout preparations in Denmark.

Rival biotechs hit milestones

Codexis and Diversa, biotechnology firms specializing in directed evolution techniques, each announced receipt of milestone payments last week. Codexis was paid for a research project with Pfizer in which the firms are collaborating on biocatalysts used in the production of unspecified Pfizer small-molecule therapeutics. Diversa hit a milestone in an agreement with Xoma for the generation of an antibody that binds with subpicomolar affinity to an undisclosed Xoma target. The deal with Pfizer could net Codexis up to $40 million over several years, according to Codexis. Financial details on the agreement between Diversa and Xoma were not released.

Chinese firm seeks to buy Thai Petrochem

Citic Resources Holdings, a subsidiary of the Chinese-backed Citic Group, is expressing interest in acquiring a 75% stake in Thai Petrochemical Industry, a bankrupt company now administered by the finance ministry of Thailand. Citic's announcement will delay a Thai government plan to sell most of TPI to the Thai oil and chemical firm PTT. Citic intends to set up a joint venture, Citic Petrochemical, with TPI's previous major shareholders, including founder Prachai Leophairatana, who has been campaigning to regain control of the firm. Citic says the deal makes sense because TPI produces materials that China imports in large quantities.

Air Products in China pact

Air Products & Chemicals has formed a joint venture with Changzhou Shangfeng Chemical Industry, based in Changzhou, in China's Jiangsu province, to produce triethylenediamine. Air Products says a TEDA plant operated by Shangfeng has been transferred to the joint venture, which is majority owned by Air Products. Air Products already makes TEDA, used as a catalyst in the manufacture of polyurethane foam, in Paulsboro, N.J.

M&G is building PTA in Brazil

Mossi & Ghisolfi's board of directors has approved the construction of a 750,000-metric-ton-per-year purified terephthalic acid plant in Pernambuco, Brazil. The plant, scheduled for completion in 2008, will feed the polyethylene terephthalate plant that M&G is building nearby. Most of the remaining capacity will be sold into the regional merchant market, the firm says.

BUSINESS ROUNDUP

Procter & Gamble has signed contracts worth more than $1 billion to purchase oleochemicals that will be made in plants being built in Indonesia by the Domba Mas Group. P&G and its partner revealed plans for the facilities last year.

Lanxess plans to expand capacity of its maleic anhydride plant in Baytown, Texas, to 160 million lb by the end of 2006 from 120 million lb today. The firm says it is responding to growing demand for the polyester intermediate.

Cabot Corp. has received notification that the European Commission has ended an investigation into possible price fixing in the European carbon black industry. The probe was launched in November 2002.

Pfizer has entered a collaboration and license deal with Renovis to develop small molecules that target the vanilloid receptor, VR1. Pfizer will pay a $10 million license fee and research funding in excess of $7 million.

Dynea will sell its paper overlays plant in Welcome, N.C., to the carpet maker Shaw Industries for an undisclosed sum. As part of the deal, Dynea will continue to supply impregnating resin to the plant, which had sales of roughly $60 million in 2004.

Morphochem has supplied a collection of small-molecule compounds to Novartis, completing a research agreement. The German firm developed the compounds, active against three Novartis targets, with its MOREsystem technology.

Lion Bioscience has filed to deregister its ordinary shares under the U.S. securities laws in order to save on reporting expenses. Lion already voluntarily delisted its American Depositary Shares from NASDAQ.

Bayer and Sumitomo Chemical will codevelop a new fungicide to combat rice blast. The fungicide, identified by Bayer, is intended for use primarily in Japan. Product launch is targeted for the end of the decade.

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