If you have an ACS member number, please enter it here so we can link this account to your membership. (optional)

ACS values your privacy. By submitting your information, you are gaining access to C&EN and subscribing to our weekly newsletter. We use the information you provide to make your reading experience better, and we will never sell your data to third party members.



Air Products Restructures

Company acquires specialties firm, sells dinitrotoluene plant, and plans other sales

by William Storck
March 27, 2006 | A version of this story appeared in Volume 84, Issue 13

Credit: Air Products Photo
Air Products is selling this Geismar, La., DNT plant to BASF as part of its revamping program.
Credit: Air Products Photo
Air Products is selling this Geismar, La., DNT plant to BASF as part of its revamping program.

Air Products & Chemicals is launching a restructuring effort intended to increase growth, improve return on capital, and return value to shareholders.

The company says it will sell its dinitrotoluene (DNT) plant in Geismar, La., to BASF; acquire specialty surfactants maker Tomah3 Products; explore the sale of its polyurethane intermediates, amines, and polymers businesses; and initiate a $1.5 billion stock buyback. In addition, Air Products will raise its quarterly dividend by 2 cents to 38 cents per share.

Combined 2005 sales for the units on the block were about $1.25 billion, some 20% of Air Products' total. "When these actions are completed, our growth businesses will make up over 60% of our overall annual revenues, up from just 35% in 2000," CEO John Jones says.

The sale of the DNT plant to BASF for $155 million is part of a restructuring of the firm's polyurethane intermediates business, which had 2005 sales of about $400 million. The plant is on BASF property, and the German firm has been its sole customer. Air Products is also considering the sale of a larger DNT/toluenediamine facility in Pasadena, Texas, that has multiple customers.

The amines business, which had 2005 sales of about $300 million, produces methylamines and higher amines at facilities in the U.S. and Brazil. Don Carson, a chemical stock analyst at Merrill Lynch, expects a financial buyer for this business to emerge.

The polymers business has two main units owned jointly with Wacker Chemie AG: one producing emulsions and the other making redispersible powders. Annual sales are about $550 million. Carson says Dow Chemical, Rohm and Haas, and BASF are potential bidders for these units.

Meanwhile, Air Products will pay $115 million for Tomah, which has annual sales of about $73 million and produces nonionic surfactants based on amine chemistry and alcohol alkoxylates. The two firms have had a commercial development agreement since 2004.



This article has been sent to the following recipient:

Chemistry matters. Join us to get the news you need.