Chemical and biotechnology company Lonza Group Ltd. plans to sell shares in Lonza SpA, the Italian business of its polymer intermediates division, to reduce group exposure to high raw-material prices.
Announcing its plan to dispose of the shares through an initial public offering on the Italian Stock Exchange, Basel, Switzerland-based Lonza said it will rename the business Polynt SpA. It expects to receive authorization for the filing in the third quarter of this year, Lonza said.
Lonza SpA represents a major slice of the group's plastic intermediates interests, which is the smallest of its three divisions. Based in Scanzorosciate, Lonza's Italian business produces a range of plastic resins, molding compounds, composites and additives at its five plants: one each in Ravenna, Brembate Sopra and San Giovanni Valdarno, and two plants in Scanzorosciate.
Apart from Italy, Lonza has one other molding compounds production facility, Lonza Compounds GmbH in Miehlen, Germany.
The announcement follows speculation that Lonza was planning to sell its entire plastic intermediates business. The market value of the division is estimated at around 600 million Swiss francs ($487 million), according to a Dow Jones report.
Last year, the division recorded operating profit of SFr46 million ($37 million) on annual sales of SFr719 million ($584 million).
News of the IPO comes days after Lonza Group agreed to sell specialty technical films business Lofo High Tech Film GmbH to Shinkong Synthetic Fibers Corp. of Taipei, Taiwan.
Lofo is a leader in the production of high-tech solvent cast films for the electrical and optical-electronic sectors and other technical applications. Formerly known as Lonza-Werke, it runs one plant in Weil am Rhein, Germany.
Shinkong will take over 100 percent of the Lofo shares, buying the business and its assets through a subsidiary, according to Lonza. Shinkong runs three plants in Taiwan, turning out 2.8 million pounds of polyester-based products daily. These include polyester fiber, chip and film; PET bottle-grade resin; PET preforms and bottles; optical-grade films; amorphous PET sheet and engineering polymers, according to the family-owned company.
Shinkong, listed on the Taiwan Stock Exchange, reported annual worldwide sales in 2005 of around US$660 million. It is part of the diverse Shinkong Group.
The two Lonza disposals are in line with its strategy of concentrating on growing its biotechnology business area, said group Chief Executive Officer Stefan Borgas.