Hexion Specialty Chemicals Inc. the world's largest thermoset plastics maker is merging with Momentive Performance Materials Inc. to create a specialty chemicals company with annual sales of $7.5 billion.
Both Columbus, Ohio-based Hexion and Albany, N.Y.-based Momentive are majority-owned by private equity firm Apollo Management LP of New York. Officials with the companies said that no additional financing is required for the merger, which is set to close Oct. 1.
The combined company will keep the Momentive name, but will be headquartered in Columbus and led by Hexion Chairman and CEO Craig Morrison.
The new firm will have more than 10,000 employees and will operate 117 manufacturing sites worldwide.
Hexion formed from the 2005 merger of four specialty chemicals firms had sales of $4 billion in 2009. In the first half of 2010, the firm's sales grew 33 percent to almost $2.5 billion when compared with the first half of 2009, but first-half profit fell 26 percent to $45 million in the same comparison.
Epoxy and phenolic resin was the largest of Hexion's three segments in the first half of 2010, generating 47 percent of overall sales.
That unit's pretax profit also grew 63 percent to $178 million in the first half.
Momentive was formed in 2006 when Apollo bought the GE Advanced Materials unit, including silicone and quartz production, from General Electric Co.