Skip to main content
Sister Publication Links
  • Sustainable Plastics
  • Rubber News
Subscribe
  • Sign Up Free
  • Login
  • Subscribe
  • News
    • Processor News
    • Suppliers
    • More News
    • Digital Edition
    • End Markets
    • Special Reports
    • Newsletters
    • Resin pricing news
    • Videos
    • Injection Molding
    • Blow Molding
    • Film & Sheet
    • Pipe/Profile/Tubing
    • Rotomolding
    • Thermoforming
    • Recycling
    • Machinery
    • Materials
    • Molds/Tooling
    • Product news
    • Design
    • K Show
    • Mergers & Acquisitions
    • Sustainability
    • Public Policy
    • Material Insights Videos
    • Numbers that Matter
    • Automotive
    • Packaging
    • Medical
    • Consumer Products
    • Construction
    • Processor of the Year
    • Best Places to Work
    • Women Breaking the Mold
    • Rising Stars
    • Diversity
    • Most Interesting Social Media Accounts in Plastics
  • Opinion
    • The Plastics Blog
    • Kickstart
    • One Good Resin
    • Pellets and Politics
    • All Things Data
    • Viewpoint
    • From Pillar to Post
    • Perspective
    • Mailbag
    • Fake Plastic Trees
  • Shop Floor
    • Blending
    • Compounding
    • Drying
    • Injection Molding
    • Purging
    • Robotics
    • Size Reduction
    • Structural Foam
    • Tooling
    • Training
  • Events
    • K Show Livestream
    • Plastics News Events
    • Industry Events
    • Injection Molding & Design Expo
    • Livestreams/Webinars
    • Editorial Livestreams
    • Ask the Expert
    • Plastics News Events Library
    • Processor of the Year submissions
    • Plastics News Executive Forum
    • Injection Molding & Design Expo
    • Plastics News Caps & Closures
    • Women Breaking the Mold Networking Forum
    • Plastics in Automotive
    • PN Live: Mergers and Acquisitions
    • Polymer Points Live
    • Numbers that Matter Live
    • Plastics in Politics Live
    • Sustainable Plastics Live
    • Plastics Caps & Closures Library
    • Plastics in Healthcare Library
    • Women Breaking the Mold Networking Forum Library
  • Rankings & Data
    • Injection Molders
    • Blow Molders
    • Film Sheet
    • Thermoformers
    • Pipe Profile Tubing
    • Rotomolders
    • Mold/Toolmakers
    • LSR Processors
    • Recyclers
    • Compounders - List
    • Association - List
    • Plastic Lumber - List
    • All
  • Directory
  • Resin Prices
    • Commodity TPs
    • High Temp TPs
    • ETPs
    • Thermosets
    • Recycled Plastics
    • Historic Commodity Thermoplastics
    • Historic High Temp Thermoplastics
    • Historic Engineering Thermoplastics
    • Historic Thermosets
    • Historic Recycled Plastics
  • Custom
    • Sponsored Content
    • LS Mtron Sponsored Content
    • Conair Sponsored Content
    • KraussMaffei Sponsored Content
    • ENGEL Sponsored Content
    • White Papers
    • Classifieds
    • Place an Ad
    • Sign up for Early Classified
MENU
Breadcrumb
  1. Home
  2. News
September 18, 2018 02:00 AM

Clariant, Sabic to merge part of materials portfolio

Karen Laird
Editor, Sustainable Plastics
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print
    Clariant AG
    Clariant CEO Hariolf Kottmann and Chief Financial Officer Patrick Jany discuss the memorandum of understanding with Sabic at a Sept. 18 news conference.

    Swiss materials supplier Clariant AG and Saudi chemical company Sabic are to merge parts of their businesses in a bid to create a leading supplier of high-performance materials.

    The move follows Sabic's takeover of a 24.99 percent stake in Clariant earlier this month, and builds on their previous Catalyst joint venture Scientific Design between the two companies.

    The Muttenz, Switzerland-based Clariant announced Sept. 18 that it had signed a memorandum of understanding with Sabic to combine its additives and high value masterbatches — color, high temperature resins and health care — with parts of Sabic's specialties business to create a new joint venture business for high performance materials.

    The deal doesn't include several well-known Sabic materials that originated with GE Plastics. Materials remaining with Sabic include Lexan-brand polycarbonate, Cycolac-brand ABS, Cycoloy-brand PC/ABS, Valox-brand PBT and Xenoy-brand PC/PBT.

    A definitive agreement is expected to be signed in the first half of 2019 with the business, which is estimated to create over 3.5 billion euros ($4 billion) in sales by 2021, to be carved out by the end of next year. The new business is set to launch at the start of of 2020, subject to regulatory approvals.

    The proposed business will offer a range of high-performance thermoplastics for demanding thermo-electro-optical and mechanical environments, specialty additives and masterbatches.

    Clariant has described the move as a portfolio upgrade which will enable its strategy to achieve a “significant step change into higher value specialties” and increase value for stakeholders. 

    “We are getting the engineering plastics business from Sabic for electric mobility, high-temperature, high performance. It's a good business with 2 billion Swiss francs ($2.08 billion) in sales and we are combining this with our business, worth 1 billion francs ($1.04 billion). This we will grow from 3 billion francs ($3.12 billion) to 4 billion Swiss francs ($4.16 billion) in 2021,”said CEO Hariolf Kottmann during a Sept. 18  conference call.

    According to Kottmann, the move is to “create stability, not uncertainty” for Clariant and for the market.

    “As we said when we were considering the Huntsman merger, you need a certain size to be successful in the chemical industry. This is first move in this direction. There is no [full] merger on our agenda today. But you can never exclude what a company will do in another five-six years,” said the CEO, during the call in response to questions about the companies' future.

    Clariant will have the majority stake in the intended business combination. To that end, an equalization consideration will be made by Clariant to Sabic, the amount of which will depend on the definitive valuation which is to be determined by both parties in the coming months. 

    The intended business will supply to a wide range of sectors, including smart electronics, health care, aerospace, automotive, robotics, additive manufacturing, renewable energy and e-mobility. 

    The unit, Clariant said, will have “superior ability” to meet customer specifications and provide technological advantages. This will create the basis for its accelerated profitable growth.

    The combination of the two businesses is also expected to result in significant synergies with an anticipated annual run-rate of 100 million Swiss francs ($104 million), realized across three years from closing.

    Sabic's current business that is being merged with Clariant is the former GE Plastics. Headquartered in Amsterdam, this was acquired by Sabic for $11.6 billion in 2007.

    The headquarters of the new JV has not yet been determined, but the two companies expect it to employ 700 once operational.

    The Swiss chemical supplier further clarified Sabic's investment in the company, with the announcement of a new governance agreement which defines the Saudi company's position as “a strategic anchor shareholder” in Clariant.

    Under the new governance agreement, Clariant will continue its independence as a publicly-listed company under Swiss corporate governance.

    At a special general meeting scheduled for Oct. 16, it will be proposed to expand the Clariant board of directors from 10 to 12 members. Four of the board members will be nominated by SABIC.

    The proposal calls for Kottmann to become the new chairman of the board, succeeding Rudolf Wehrli. Kottmann will resign from his position as Clariant CEO Oct. 16. while Ernesto Occhiello, Sabic's current specialties executive vice president, would take over as Clariant CEO on Oct. 16.

    “Clariant is a strong company with an impressive track record which will continue on its successful path with Hariolf Kottmann as the new Chairman,” Sabic CEO Yousef Al-Benyan said in a Sept. 18 statement.

    Specialty chemicals, Al-Benyan said, are an important building block for  Sabic's strategy.

    “We see ourselves as a responsible long-term oriented strategic shareholder, and the governance agreement underlines our commitment to create value for all stakeholders,” he added.

    In addition to the major collaboration with Sabic, Clariant also announced plans for divesting its pigments, standard masterbatches and medical specialties businesses by 2020. The businesses will not be included in the newly-formed high-performance materials business unit.

    The company said it is not in talks with any possible buyer for those businesses at the moment.

    Plastics News' Senior Reporter Frank Esposito contributed to this report.

    RECOMMENDED FOR YOU
    Georgia home to new PET chemical recycling plant
    Letter
    to the
    Editor

    Do you have an opinion about this story? Do you have some thoughts you'd like to share with our readers? Plastics News would love to hear from you. Email your letter to Editor at [email protected]

    SIGN UP FOR OUR FREE NEWSLETTERS
    EMAIL ADDRESS

    Please enter a valid email address.

    Please enter your email address.

    Please verify captcha.

    Please select at least one newsletter to subscribe.

    Get our newsletters

    Staying current is easy with Plastics News delivered straight to your inbox, free of charge.

    Subscribe today

    Subscribe to Plastics News

    Subscribe now
    Connect with Us
    • LinkedIn
    • Facebook
    • Twitter
    • Instagram

    Plastics News covers the business of the global plastics industry. We report news, gather data and deliver timely information that provides our readers with a competitive advantage.

    Contact Us

    1155 Gratiot Avenue
    Detroit MI 48207-2997

    Customer Service:
    877-320-1723

    Resources
    • About
    • Staff
    • Editorial Calendar
    • Media Kit
    • Data Store
    • Digital Edition
    • Custom Content
    • People
    • Contact
    • Careers
    • Sitemap
    Related Crain Publications
    • Sustainable Plastics
    • Rubber News
    • Tire Business
    • Urethanes Technology
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Copyright © 1996-2023. Crain Communications, Inc. All Rights Reserved.
    • News
      • Processor News
        • Injection Molding
        • Blow Molding
        • Film & Sheet
        • Pipe/Profile/Tubing
        • Rotomolding
        • Thermoforming
        • Recycling
      • Suppliers
        • Machinery
        • Materials
        • Molds/Tooling
        • Product news
        • Design
      • More News
        • K Show
        • Mergers & Acquisitions
        • Sustainability
        • Public Policy
        • Material Insights Videos
        • Numbers that Matter
      • Digital Edition
      • End Markets
        • Automotive
        • Packaging
        • Medical
        • Consumer Products
        • Construction
      • Special Reports
        • Processor of the Year
        • Best Places to Work
        • Women Breaking the Mold
        • Rising Stars
        • Diversity
        • Most Interesting Social Media Accounts in Plastics
      • Newsletters
      • Resin pricing news
      • Videos
    • Opinion
      • The Plastics Blog
      • Kickstart
      • One Good Resin
      • Pellets and Politics
      • All Things Data
      • Viewpoint
      • From Pillar to Post
      • Perspective
      • Mailbag
      • Fake Plastic Trees
    • Shop Floor
      • Blending
      • Compounding
      • Drying
      • Injection Molding
      • Purging
      • Robotics
      • Size Reduction
      • Structural Foam
      • Tooling
      • Training
    • Events
      • K Show Livestream
      • Plastics News Events
        • Plastics News Executive Forum
        • Injection Molding & Design Expo
        • Plastics News Caps & Closures
        • Women Breaking the Mold Networking Forum
        • Plastics in Automotive
      • Industry Events
      • Injection Molding & Design Expo
      • Livestreams/Webinars
        • PN Live: Mergers and Acquisitions
      • Editorial Livestreams
        • Polymer Points Live
        • Numbers that Matter Live
        • Plastics in Politics Live
        • Sustainable Plastics Live
      • Ask the Expert
      • Plastics News Events Library
        • Plastics Caps & Closures Library
        • Plastics in Healthcare Library
        • Women Breaking the Mold Networking Forum Library
      • Processor of the Year submissions
    • Rankings & Data
      • Injection Molders
      • Blow Molders
      • Film Sheet
      • Thermoformers
      • Pipe Profile Tubing
      • Rotomolders
      • Mold/Toolmakers
      • LSR Processors
      • Recyclers
      • Compounders - List
      • Association - List
      • Plastic Lumber - List
      • All
    • Directory
    • Resin Prices
      • Commodity TPs
        • Historic Commodity Thermoplastics
      • High Temp TPs
        • Historic High Temp Thermoplastics
      • ETPs
        • Historic Engineering Thermoplastics
      • Thermosets
        • Historic Thermosets
      • Recycled Plastics
        • Historic Recycled Plastics
    • Custom
      • Sponsored Content
      • LS Mtron Sponsored Content
      • Conair Sponsored Content
      • KraussMaffei Sponsored Content
      • ENGEL Sponsored Content
      • White Papers
      • Classifieds
        • Place an Ad
        • Sign up for Early Classified