Apr 26 2005
Borden Chemical and Resolution Performance Products today jointly announced plans to merge, together with Resolution Specialty Materials, to form the world’s largest producer of thermosetting resins. All three companies are owned by affiliates of the private investment firm Apollo Management, L.P. The new company will be named Hexion Specialty Chemicals, Inc.
Hexion Specialty Chemicals is expected to include Bakelite AG, which as previously announced, Borden Chemical has agreed to acquire. The combination of Borden Chemical, RPP and RSM and the acquisition of Bakelite are expected to close in the second quarter of 2005.
Borden Chemical is a leading global producer of binding and bonding resins, performance adhesives and the building-block chemical formaldehyde. RPP is a leading worldwide manufacturer and developer of epoxy resins and is the leading global manufacturer of Versatic acids and derivatives. RSM is a global producer of coatings, adhesives, specialty polymers, and ink raw materials. Bakelite is a leading supplier of phenolic and epoxy thermosetting resins and molding compounds in Europe.
Hexion Specialty Chemicals had pro forma 2004 annual net sales of $4.105 billion, of which 51% were derived from North America, 32% from Western Europe, and 17% from Asia and the rest of the world. Hexion will have approximately 7,000 employees and rank third among North American-based specialty chemical firms in terms of sales. It will:
Craig Morrison, president and chief executive officer of Borden Chemical, will be President and CEO of Hexion Specialty Chemicals, which will be based in Columbus, Ohio. Marvin Schlanger, Chairman and CEO of RPP and Chairman of RSM, will become Vice Chairman of the Board of Hexion. William Carter, executive vice president and CFO for Borden Chemical, will assume this role for the combined company.
"This merger is an exciting development for the employees and customers of all four companies," Morrison said. “The four companies have complementary businesses with outstanding technologies and products, and excellent synergies. The new name represents a combined entity that is different from and stronger than any one of the merging companies. Our increased size and combined financial capability will enable us to better serve our customers, and create new opportunities for employees.”
The executive team of Hexion will also include these heads of business units: Kip Smith, president and chief operating officer of RPP, will become President, Epoxy and Phenolic Resins; Jeff Nodland, President of RSM, will become President, Coatings and Inks; Jody Bevilaqua, executive vice president of Borden Chemical, will become President, Formaldehyde and Forest Product Resins; and Sarah Coffin, executive vice president of Borden Chemical, will become President, Performance Products.
Completion of the combination is subject to customary closing conditions including certain regulatory approvals. Borden Chemical, RPP and RSM will continue to operate independently until those conditions are satisfied and the closing occurs.
http://www.bordenchem.com