LANXESS buys out Dow Chemical´s share in CISA, strengthens commitment to South Africa operations.
JOHANNESBURG (SA) – Chemicals group Lanxess is purchasing the chrome chemicals activities of The Dow Chemical Company in South Africa. Lanxess is to acquire the 50% interest in Chrome International South Africa (CISA), in Newcastle, which The Dow Chemical Company currently owns through its subsidiary Sentrachem.
The remaining 50% of CISA is already owned by Lanxess. It has been agreed not to disclose the purchase price. Closing of the transaction, which is subject to the approval of the antitrust authorities and the Board of The Dow Chemical Company, is expected for the first quarter of 2007. This is Lanxess' first acquisition since it listed on the Frankfurt Stock Exchange in January 2005.
“This buyout demonstrates our continued commitment to our operations in this country,” said Dr Bernhard Wehling, head of Lanxess' leather business unit. “We now have complete control of the value chain from the chromium mine in Rustenburg, through the chrome chemicals production facility at Newcastle to our chrome tanning salts plant at Merebank in Durban,” said Wehling. Lanxess is the only company operating the whole value chain from chrome ore to chrome tanning salts in South Africa.
The Newcastle plant is a core element of Lanxess' worldwide chrome network. CISA was established in the mid-1990s and employs some 120 people. Its 2005 sales were equivalent to about EUR 40 million. Officially opened in 1999, the Newcastle facility is the most modern chrome chemical production facility in the world, producing 70,000 tons of sodium dichromate annually and employing state-of-the-art environmental technology.
“Our operations at Rustenburg, and now Newcastle, as well as Merebank are all export-oriented, making Lanxess a valuable foreign exchange earner for South Africa,' said Dr Michael Krancher, managing director of Lanxess in South Africa.
Lanxess is one of the leading European chemicals suppliers, with 2005 sales of EUR 7.15 billion and approximately 17,000 employees in 18 countries. The core business of Lanxess is the development, manufacture and sale of chemicals, rubber and plastics.
The leather business unit of Lanxess is among the leading suppliers to the global leather industry and currently has a global workforce of over 1,000. The integration of the CISA workforce into the Lanxess group will boost the South African Lanxess workforce to around 450. This means that significantly more than a third of the leather business unit's employees are based in South Africa. – Margarete Meyer [Corporate Communications, tel: +27 (0)11 921 5243]
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