By Frank Esposito, Plastics News Staff
Columbus, Ohio -- Hexion Specialty Chemicals Inc. -- the world's largest thermoset plastics maker - is merging with Momentive Performance Materials Inc. to create a speciality chemicals company with annual sales of $7500 million.
Both Columbus, Ohio-based Hexion and Albany, New York-based Momentive are majority-owned by private equity firm Apollo Management LP of New York. Officials with the firms said that no additional financing is required for the merger, which is set to close 1 Oct.
The combined company will keep the Momentive name, but will be based in Columbus and led by Hexion chairman and chief executive officer Craig Morrison. The new firm will have more than 10 000 employees and will operate 117 manufacturing sites worldwide.
Momentive was formed in 2006 when Apollo bought the GE Advanced Materials unit - including silicone and quartz production - from General Electric Co. The group's silicones business is a major supplier of polyurethane additives, including silicone surfactants, catalysts, and foam modifiers, with a current focus on additives for polyurethane foam using bio-based polyols.
Hexion - formed from the 2005 merger of four speciality chemicals firms -had sales of $4000 million in 2009. In the first half of 2010, thefirm's sales grew 33 percent to almost $2500 million when compared tothe first half of 2009, but first-half profit fell 26 percent to $45million in the same comparison.
Epoxy and phenolic resins was the largest of Hexion's three segments in the first half of 2010, generating 47 percent of overall sales. That unit's pretax profit also grew 63 percent to $178 million in the first half. Hexion's company's extensive coatings resins business in the Americas supplies some polyurethane resins for various applications.