Jan 5 2009
The Lubrizol Corporation (NYSE:LZ) announced today that it has acquired the thermoplastic polyurethane (TPU) business from The Dow Chemical Company, a $54 billion diversified chemical company. This acquisition, structured as a sale and purchase of assets, will expand Lubrizol’s Estane® Engineered Polymers business. The Dow TPU business had 2007 revenues of approximately $85 million. The deal closed on December 31, 2008.
Located in La Porte, TX, Dow’s TPU product line spans the continuum between elastomeric and rigid TPU properties. The two key brands representing the business are: • PELLETHANE™ Thermoplastic Polyurethane Elastomers, used in a variety of high-value elastomer applications including footwear, medical tubing, automotive, film and industrial/engineering applications; and • ISOPLAST™ Engineering Thermoplastic Polyurethane Resins, used in a variety of niche, specialty applications that require its unique combination of high-end engineering plastic properties that include clarity, impact strength and chemical resistance.
With 50 years of industry experience, Lubrizol is a global leader in thermoplastic elastomers, marketing products under the Estane Thermoplastic Polyurethane brand name. Estane TPU is an engineered, highly versatile thermoplastic elastomer that is utilized in film extrusion, tubing, cable jacketing, injection molding, calendaring and solution processes for applications such as textiles, wire and cable, hose and tube, optical, industrial, agriculture and others.
“We are excited to be adding Dow’s TPU capabilities and products to our existing Estane Engineered Polymers business. Given Dow’s strong TPU brand recognition in the U.S., this addition further supports our strategy of growth through geographic expansion as it will allow us to introduce new products and technology to international markets where Dow’s TPU business has had limited penetration,” said Mike Vaughn, Lubrizol vice president, Estane Engineered Polymers. “The acquisition continues to strengthen and expand our product portfolio and provides us access into new end uses, such as niche medical applications, which we believe will benefit our customers worldwide.”
Although Dow has demonstrated proven product development capabilities, strong customer relationships and a solid industry reputation over the years, it has decided to exit its TPU business due to a re-focus on investment priorities and the lack of a strategic fit. “I am pleased that this transaction with Lubrizol will provide our experienced and knowledgeable workforce, as well as our customers, the benefit of increased scale to support additional investment in new and enhanced technologies, products and services,” stated George Biltz, Dow Corporate Vice President, Strategic Development and Planning . “I am sure our business and our customers will be in good hands.” The move ensures that Dow’s existing customers will continue to be supplied with the company’s products.
The agreement includes all commercial, production and research and development assets of the Dow TPU business. Lubrizol will be assuming approximately 40 full-time employees. All Dow TPU products will be transitioned immediately to Lubrizol. The Dow brand names will be retained and unified under the Estane Engineered Polymers business.