Industry News

Solvay Divests its Polyamides Business to BASF and Domo Chemicals

Published on 2020-02-03. Author : SpecialChem

solvay-polyamide-business-acquisition Solvay has formally completed the divestment of its Performance Polyamides activities to BASF and Domo Chemicals. This represents the last step in the transaction agreed between Solvay and BASF, for which the European Commission required to divest certain of Solvay’s performance polyamides assets to a third party.

The transaction is based on an enterprise value of 1.6 billion euros and the net cash proceeds to be received on the combined transaction are estimated to be around 1.2 billion euros, subject to customary post-closing purchase price adjustments. The closing of this transaction will allow Solvay to strengthen its recently announced G.R.O.W. strategy.

Asset Acquisition by Domo Chemicals

The assets acquired by the third party, Domo Chemicals, include Solvay's performance polyamides production sites at Belle-Etoile and Valence (France), as well as a stake in a newly created joint venture between BASF and Domo in Chalampé (France). They also involve production sites in Gorzow (Poland), Blanes (Spain) and commercial activities in Germany and Italy.

The Business comprises Production, Sales, Technical Support, R&D and Innovation services in France, Spain, Poland, Germany and Italy that currently have a combined headcount of approximately 1,100 employees. The agreement also involves a joint venture between BASF and DOMO in France to produce Adipic Acid.

Comments from Yves Bonte

Yves Bonte, DOMO Chemicals CEO, says, "This acquisition is a significant milestone on our path to strengthen DOMO Chemicals’ nylon-based engineering materials business. It is an important step in delivering on our sustainable growth strategy by combining and leveraging on the unique technology, development and design capabilities of our combined teams to become a major global service provider to our customers in our key markets Transportation, Electrical & Electronics and Consumer goods.”

Mr. Bonte added, "As a final step in the acquisition, we will now start our process of exploring and integrating the complementary strengths of the diverse teams and talents. Our prime focus will continue to be serving our customers’ needs and meeting their requirements as we set out to become a unique integrated Nylon (6 and 6.6) solution provider”.

BASF’s Acquisition of Performance Polyamides Activities

BASF will acquire all the Performance Polyamides activities of Solvay that are not acquired by Domo Chemicals and that are part of the original agreement between Solvay and BASF.

The transaction broadens BASF’s polyamide capabilities with innovative and well-known products such as Technyl®. This will allow BASF to support its customers with even better engineering plastics solutions, e.g., for autonomous driving and e-mobility.

Growth in America and Asia

The transaction also enhances the company’s access to growth markets in Asia as well as in North and South America. Through the backward integration into the key raw material adiponitrile (ADN), BASF will now be present along the entire value chain for polyamide 6.6 and improve its supply reliability.

Details of the Transaction

The purchase price for the polyamide business acquired by BASF on a cash and debt-free basis amounts to 1.3 billion euros. The business will be integrated into the Performance Materials and Monomers divisions of BASF.

With a broader portfolio, a stronger regional presence and improved supply reliability BASF will deliver significant benefits to our customers,” said Wayne T. Smith, member of the board of executive directors of BASF SE. “The acquisition stands for our strong commitment to the polyamide business globally.”

Eight Production Sites and R&D Centers

The transaction between Solvay and BASF includes eight production sites in Germany, France, China, India, South Korea, Brazil and Mexico as well as research and development centers and technical consultation centers in Asia, North and South America. In addition, it encompasses shares in two joint ventures (JV) in France: Solvay’s 50 percent share in the Butachimie JV with Invista to produce ADN and hexamethylenediamine (HMD) and a 51 percent share in the new Alsachimie JV between BASF and DOMO Chemicals to produce adipic acid.

At closing, approximately 700 Solvay employees join BASF. The Alsachimie JV between BASF and DOMO Chemicals in France employs approximately 650 employees, the Butachimie JV between BASF and Invista has approximately 400 employees.

Source: Solvay, BASF and Domo Chemicals
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