By Patrick Raleigh, UT On-line news editor Lemförde, Germany-Elastogran, a subsidiary of BASF AG has acquired the polyurethane systems business of Lagomat AB, based in Angered, near Gothenburg, Sweden. The firm announced the deal in an annual results statement, which showed a sharp drop in earnings last year.Lagomat is a 30-year-old company supplying flexible and rigid foam and cast elastomer systems to customers in the automotive, electronics, furniture, building and construction sectors. The Swedish acquisition is in-line with Elastogran's strategy of "market expansion and customer-oriented co-operation by decentralising its PU system manufacturing in order to be closer to its European clients," BASF said. During 2003, Elastogran said its PU systems business "developed less positively," than its PU basic products and PU special elastomers, both of which increased output.In 2004, Elastogran expects PU systems to take a greater share of its total business, particularly if the unit can pass on higher raw material prices to customers. For 2003, Elastogran posted an 18-percent drop in pre-tax profit to €78 million. The decline was due "to a weak global economy, price reductions in all fields of activity and a weak dollar," said a 17 March company statement. The earning dip was despite a 7-percent rise in 2003 sales to €1360 million, and reflected differing fortunes at its three operational segments, said Elastogran, which employs 1767 at 10 European sites."