Dow to get $2.16B for failed Kuwait deal
MIDLAND, MICH. — Dow Chemical Co. has been awarded $2.16 billion in an arbitration case connected to its attempt to sell its commodity plastics business to Petrochemical Industries Co. of Safat, Kuwait, in 2008.
The International Court of Arbitration in Paris ruled May 24 that PIC must pay Midland-based Dow for backing out of the deal. Both sides had agreed to have the dispute settled by the court. The decision is binding and can't be appealed.
“This outcome brings resolution and closure to the issue,” Dow Chairman and CEO Andrew Liveris said in a May 24 news release.
State-owned PIC had planned to buy half of Dow's polyethylene, polypropylene and polycarbonate businesses and related assets for about $8.5 billion. But the recession that hit global markets in 2008 reduced the assets' value, leading Kuwaiti lawmakers to convince government officials in December 2008 that the deal was no longer viable.
Since that point, major North American natural gas discoveries have increased the value and profitability of Dow's PE assets. The firm later sold its PP business to Braskem SA.
Dow spokeswoman Kasey Anderson said the firm hasn't factored the $2.16 billion into its current finances. She added that the settlement will enhance Dow's “financial flexibility.”
Soggy fields boost demand for PE pipes
AUBURN, ILL. — Scanning a productive Midwest corn or soybean field can provide a quick answer as to why Springfield Plastics Inc. is pumping up production of polyethylene drainage pipes.
“It doesn't take a farmer to see where corn is 3 feet high or where it is a few inches, or there is no corn at all. You instantly know which has too much water,” said Steve Baker, president of Auburn-based Springfield Plastics, in a telephone interview.
“In the Midwest, 2012 has been the perfect growing season, but the previous four were just the opposite,” said Baker, noting that high rainfall forced some farmers to replant crops.
Springfield is working 24 hours a day and plans to boost its capacity 20 percent by adding another extrusion line by the end of July. The company employs 60. Baker said he expects to add 10-12 people as production rises.
Blako closes doors, blames recession
DUNBRIDGE, OHIO — Specialty film maker Blako Industries Inc. closed at the end of March and the blown film equipment in its plant in Dunbridge has been sold, President Ed Long said.
“We were hit very hard by the recession. We were heavily into automotive and we struggled to recover,” Long said in a May 24 telephone interview. Blako had about 15 employees, he said.
Long was one of the first employees in 1970 when John Kretzschmar and three other investors formed Blako. Long was plant manager, getting the film equipment installed and running the plant. Kretzschmar, the president, handled sales.
Long soon began investing in the company.
In 1996, Long, who was then vice president, and Chuck Hansen, the executive vice president, bought Kretzschmar's shares and acquired Blako. Long was majority owner.
Long said the company's lines of credit fell into default, then the company ceased operations.
Medical forum focus: molding methods
AKRON, OHIO — Plastics News' Plastics in Medical Devices 2012 conference will showcase some of the latest developments in molding techniques for medical applications.
The June 11-13 event in Westlake, Ohio, near the Cleveland airport, will include a session on using external gas-assist molding in processing parts for medical devices. The session will be led by Michael Hansen, senior technical development engineer with Mack Molding Co. of Arlington, Vt.
The process features a unit that introduces nitrogen gas into a mold cavity after it has been filled with plastic. The compressed nitrogen displaces part of the molten plastic. The result is a hollow part that is light and relatively inexpensive to make.
The PMD program also features molders Atek Plastics, Blackwell Plastics Inc., GW Silicones, Performance Plastics Ltd. and PMC LLC. The lineup also includes presenters from medical-device OEMs Cardinal Health Inc., Cannuflow Inc., Future Path Medical Holding Co. and U.S. Endoscopy, as well as an additive manufacturing authority from Materialise NV, and experts in the Food and Drug Administration approval process.
For full details, go to plasticsnews.com/pmd2012.