Solvay buys Rhodia in US$4.8 billion cash deal

Belgium-based chemical supplier Solvay SA has agreed to buy Rhodia SA of France for US$4.8 billion (3.4 billion-euros) in cash, in a move intended to create a global specialty chemicals company for emerging markets.  

The deal has been recommended by the directors of Rhodia.

“We have a shared vision in that we want to create a new group to achieve our goal of sustainable growth and development in chemistry”, said Christian Jourquin, CEO of Solvay, in a news statement. “We see the possibility of…creating a major global chemicals platform under the banner of Solvay.”

The deal will merge Solvay’s high performance specialty polymers business with Rhodia’s experience with specialty materials and engineering plastics based on polyamide 6,6.

According to the news release, Jean-Pierre Clamadieu, chairman and CEO of Rhodia, will take on the role of deputy CEO as soon as the deal is completed. The deal will almost double Solvay’s workforce to about 30,800.

“By joining Solvay, we will accelerate the overall development of our business, capitalizing on a strong financial structure, our leadership positions, and an exceptional geographic footprint,” Rhodia’s Clamadieu said.”More importantly, I feel that the similar cultures of the two groups will ensure a successful integration resulting in one strong and ambitious group.”

Family-owned Solvay, which is based in Brussels, expects to close the Rhodia purchase by late August.

Headquartered near Paris, Rhodia was the chemicals unit of French chemicals concern Rhone-Poulenc until 1998, when it was spun off from the parent company.