29 April 2005
29 April 2005
Cytec Industries Inc. has reached a definitive agreement to sell its 50 percent partnership in CYRO Industries to its joint venture partner Degussa Specialty Polymers for $95 million.
"This joint venture began in 1976 and has created value for both shareholders. However over the last few years the strategic interest of the partners has changed. The sale of our partnership interest in CYRO enables Cytec to focus greater attention to the growth of our core businesses, while letting our partner devote their resources to the growth of CYRO." said Chairman, President and Chief Executive Officer Mr. David Lilley.
Further adding that "our relationship as a supplier of high quality intermediate products to CYRO will not change after this transaction is completed and we wish Degussa and all the employees of CYRO well in their future endeavours."
James P. Cronin, Executive Vice President and Chief Financial Officer added, "This transaction makes strategic sense for both parties and is consistent with our plan to pay down debt after the recent acquisition of the Surface Specialties business. We expect the estimated proceeds of this transaction to essentially recover the carrying value of our investment in CYRO."
As a result of this transaction, Degussa will consolidate its position as a global supplier of methylmethacrylates (MMA), specialty monomers and polymers. The agreement includes four manufacturing facilities in Wallingford (Connecticut), Fortier(Louisiana), Osceola (Arkansas), Sanford (Maine), research and development assets, and sales and technical service locations in North America. The business being acquired includes about 680 CYRO personnel.
Prof. Utz-Hellmuth Felcht, Chairman of the Board of Management of Degussa said that "acquiring the chemistry and range of products manufactured and distributed by CYRO is a great fit with our core portfolio. We enhance our leading market position in monomers and specialty polymers, positioning Degussa for growth both in North America and worldwide."
"The integration of CYRO into our global network will pave the way to rollout the full range of our specialty products to the American markets. Our customers in North America are now able to benefit from optimal service performance ranging from customer specific technical advice, right up to provision of required delivery capacities. By combining our strengths, we are laying the foundation for targeted growth of our MMA, specialty monomers and acrylic-sheet businesses", said Dr. Manfred Spindler, Head of Degussa's Division Specialty Polymers which generated sales of approximately 1.4 billion euros in 2004.
Degussa views the acquisition as an exciting opportunity to position the Group for growth in innovative segments of the acrylic sheet market. In this way, Degussa will be able to establish a platform to supply the North and South American markets with specialty products such as functional (antigraffitti) sheets and newly designed sound barrier systems.