Tags: sale | Solvay | polyamide | Europe

Solvay CEO Seeks to Fix Polyamide Unit Before Considering Sale

Monday, 07 Jul 2014 07:41 AM

Solvay SA Chief Executive Officer Jean-Pierre Clamadieu said the Belgian chemicals maker needs several years of work to revamp its polyamides unit before considering a potential sale.

“The choice that we have made today is to give us the means to improve the situation,” Clamadieu told Bloomberg on the sideline of a conference in Aix-en-Provence, southern France, on July 5.

Measures to improve the business will take a “few years” to feed through to results, the CEO said, when asked when Solvay might be ready for a strategic review and potential sale. A disposal process for a sulphuric acid operation should be completed this year, he said.

To confront weak demand in its European home market for commodity products and competition from producers outside the 28-nation bloc profiting from lower feedstock prices, Solvay has started savings programs in polyamides and soda ash, and is joining forces with Ineos Group Holdings Ltd. for vinyls. Polyamide is widely used in textiles, carpets as well as car parts.

An April accord between Solvay and Invista to renew their joint venture agreement to manufacture a key ingredient of the polyamide is “one of the steps to try to regain some competitiveness in an industry which is fully impacted” by higher energy costs in Europe than elsewhere, he said.

EcoServices

Polyamide 6.6, a variant of the material that has slightly higher temperature resistance, has growth potential, Clamadieu said. Carmakers are seeking lighter materials for under-the-hood parts to replace metal ones, while the miniaturization of electronic parts has meant manufacturers need materials that can withstand heat while having thin designs. Solvay, which also makes more expensive specialty polymers including polyamide 10 and PEEK, wants to offer a broad range of products to customers, he said.

Seeking funds to invest in fast-growth segments, Solvay this year put up for sale its Eco Services unit, a U.S.-based maker of sulfuric acid used by refiners.

The sale process of Eco Services “is progressing well” and should be concluded by the end of the year, Clamadieu said. “There’s a lot of interest” as funds can raise a lot of debt for this type of asset, he said.

Market Outlook

Overall, Solvay is doing “very well” in the U.S. and Asia, Clamadieu said. The second-quarter economic backdrop was in “line with the first quarter,” showing an improvement from last year both in Europe and in the rest of the world.

“Europe’s improvement is very cautious and we’re set for several years of weak growth,” the CEO said. “The other worrying region is Latin America, Brazil is going through a rough phase. It’s probably the point of attention on our radar screen today.”

© Copyright 2017 Bloomberg News. All rights reserved.

 
1Like our page
2Share
Markets
Solvay SA Chief Executive Officer Jean-Pierre Clamadieu said the Belgian chemicals maker needs several years of work to revamp its polyamides unit before considering a potential sale.
sale, Solvay, polyamide, Europe
441
2014-41-07
Monday, 07 Jul 2014 07:41 AM
Newsmax Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved