W. R. Grace & Co. (Columbia, MD) is buying Sythetech Inc. for $19.2 million, augmenting its capacity for specialty single-site and polypropylene (PP) catalysts. Synthetech, which is a manufacturer fine chemicals that specializes in organic synthesis, biocatalysis, and chiral technologies, also has some business in the pharmaceutical sector. Greg Poling, VP W. R. Grace & Co. and president of Grace Davison, said in a release that the acquisition gives the company immediate production capacity for specialty single-site and PP catalysts, "significantly enhanc[ing] our ability to supply our large global customers with these specialized catalysts", while eliminating the need for a grass-roots facility.
Synthetech's products will join Grace's line of PP and polyethylene (PE) catalysts, which include Polytrak, Sylopol, and Magnapore. Grace recently announced a multi-year agreement to supply PP catalysts to polyolefins giant Borealis AG. The previously announced expansion of Grace's PP catalyst manufacturing capacity at its Worms, Germany facility is expected to be in operation in mid-2011.
The transaction has been approved by both companies' boards, but is subject to Synthetech shareholder approval and clearance from the U.S. Bankruptcy Court. Grace anticipates that the transaction will be completed during the fourth quarter. Synthetech, which has 63 employees, operates its primary facility out of Albany, OR. That operation includes production and R&D., while a second location in San Diego is dedicated to R&D. It will be integrated into Grace Davison's Specialty Technologies business. On June 28, Synthetech announced that it had hired Brocair Partners LLC to conduct a strategic review of its business.
According to market researcher, The Freedonia Group, downstream demand for metallocene and single-site based polymers will grow 17.7% annually through 2011, with metallocene-based linear low-density polyethylene (mLLDPE) to remain dominant, while metallocene-based high-density polyethylene (mHDPE) and PP will lead gains. Freedonia says film and sheet will stay the most common application, but will be outpaced by the gains in injection and blowmolding. Freedonia sizes the U.S. metallocene and single-site polymer industry at $2.4 billion, with leading players including Dow Chemical, ExxonMobil Chemical, INEOS, and CPChem. —[email protected]