Israel Chemicals sells 50% stake in two bromine plants

Israel Chemicals
Israel Chemicals

Israel Chemicals has set up a joint venture with Albermarle for flame retardants.

Israel Chemicals Ltd. (TASE: ICL) continues to reduce its operations in Israel in the wake of the Sheshinski II Committee recommendations on royalties and taxes. Israel Chemicals and Albemarle Corporation (NYSE: ALB) announced on Friday that they have entered into an agreement to establish a manufacturing joint venture for the production of Israel Chemicals' FR-122P polymeric flame retardant and Albemarle's GreenCrest polymeric flame retardant. In effect, Israel Chemicals has sold half of two of its bromine plants to Albermarle.

These flame retardants are designed to replace hexabromocyclododecane (HBCD). HBCD has been the leading flame retardant used in expanded (EPS) and extruded (XPS) polystyrene foam applications, but is being phased out in the European Union (EU), Japan and other countries.

The joint venture and its partners will own and operate a 2,400 MT per year plant in the Netherlands, which is currently operating, and a 10,000 MT per year Israeli plant, which is scheduled to come on line in the fourth quarter of 2014. Both plants are located at Israel Chemicals sites.

The companies said that the joint venture would enable additional capacity to be brought to the market to meet the growth needed for the EU and the rest of the world following the phase out of HBCD from these markets. The transaction is subject to certain closing conditions, including regulatory approvals, and is expected to close in 2015.

"The joint venture will allow Albemarle to continue providing its GreenCrest branded product to customers while joining forces with a proven manufacturing partner in ICL," said Troy De Soto, Albemarle's vice president, Fire Safety Solutions. "The combined experience and know-how related to bromine and bromine derivatives of Albemarle and ICL will ensure a reliable, high quality alternative offering to HBCD in the EPS/XPS segment. In addition, Albemarle brings its financial backing and GreenCrest product manufacturing experience to the venture."

Israel Chemicals Industrial Products vice president, Flame Retardants, Ilan Elkan, added, "We are delighted to partner with Albemarle in increasing the availability of our polymeric flame retardant offerings to the EPS and XPS industries. Our production of these innovative, sustainable polymeric products at ICL sites in Israel and the Netherlands will help to meet the growing market demand for next generation flame retardants. These polymeric flame retardants meet the highest regulatory demands, while better enabling the industry's transition from HBCD within the timeframe established by EU regulators."

Israel Chemicals began to produce and market its FR-122P polymeric flame retardant product commercially in 2013.

Published by Globes [online], Israel business news - www.globes-online.com - on August 31, 2014

© Copyright of Globes Publisher Itonut (1983) Ltd. 2013

Israel Chemicals
Israel Chemicals
Twitter Facebook Linkedin RSS Newsletters גלובס Israel Business Conference 2018