Chemtura

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Chemtura Corporation
Type Public
Traded as NYSECHMT
Industry chemicals, manufacturing
Founded 2005, Merger between Great Lakes Chemical and Crompton
Headquarters Philadelphia, U.S.
Area served Worldwide
Key people Craig A. Rogerson (Chairman, CEO & President)
Employees 4,400 (2012)
Website Chemtura.com

Chemtura Corporation is a global corporation headquartered in Philadelphia, Pennsylvania, with its other principal executive office in Middlebury, Connecticut. The company focuses on specialty chemicals for various industrial sectors, and these are transportation (including automotive), energy, electronics, and agriculture. Chemtura operates 24 manufacturing plants in 12 countries. Its primary markets are industrial manufacturing customers.

The corporation employs approximately 3300 people for research, manufacturing, logistics, sales and administration. Operations are located in North America, Latin America, Europe and Asia. In addition, the company has significant joint ventures primarily in the United States. For the year ended December 31, 2013, the company's global net sales were $2.2 billion.[1] As of December 31, 2013, Chemtura's global total assets were $2.7 billion. The chief executive officer is Craig A. Rogerson who is also the president and chairman of the board of Chemtura Corporation.[2][3][4][5][6]

History[edit]

A 19th century print depicting the Crompton Loom Works

Chemtura Corporation is the successor to Crompton & Knowles Corporation, which was incorporated in Massachusetts in 1900 and engaged in the manufacture and sale of specialty chemicals beginning in 1954. Crompton & Knowles traces its roots to Crompton Loom Works incorporated in the 1840s.[4][7]

In the late 1800s, Worcester, Massachusetts was a leading manufacturing center that attracted inventors and manufacturers. Both William Crompton and Lucius J. Knowles made the city their home and opened their respective loom companies there. Both were the top loom manufacturers in the world. However each company based the method of weaving on a different premise. The companies later merged (in 1879), becoming one entity known as "Crompton & Knowles Loom Works". Still supplying the world market, the new company now applied both theories of weaving.[7][8][9]

Meanwhile, in 1843 Charles Goodyear formed the Goodyear Metallic Rubber Shoe Company, Connecticut. A year later he patented the vulcanization of rubber. Goodyear's company then became one of nine companies that formed the founding of the United States Rubber Company in 1892 by Charles R. Flint also in Naugatuck, Connecticut. The rubber company manufactured a large array of products through two world wars, the Cold War, and became the Uniroyal company (Uniroyal Incorporated) in 1961.

In 1986, Uniroyal Chemical Company was formed as a subsidiary of Avery Inc. Then, in 1989, Uniroyal Chemical Company Investors Holding bought Uniroyal Chemical Company from Avery and became Uniroyal Chemical Corporation. In 1996, Uniroyal Chemical Corporation went public and merged with Crompton & Knowles. In 1999, Crompton & Knowles merged with Witco to form Crompton Corporation. In 2005, Crompton acquired Great Lakes Chemical Company, Inc., of West Lafayette, Indiana, to form Chemtura Corporation.[4][7][7][10][11]

In 1999 Witco Corporation, was another specialty chemicals company, headquartered in Greenwich Connecticut at the time. Witco was founded in 1920. By 1999. Witco had 5,970 employees, prior to the merger. Also, at that time Crompton was still known as Crompton & Knowles. However, shortly after the merger, Crompton & Knowles became simply Crompton. Additionally, the Great Lakes Chemical Corporation still exists as a subsidiary company of Chemtura.[2][12][13][14] By January 2014 the company had manufactured and marketed a new brominated polymer flame retardant, replacing the traditional Hexabromocyclododecane (HBCD) flame retardant.[15]

Further acquisitions[edit]

By the end of January 2007 Chemtura completed stock acquisition and ownership of Kaufman Holdings Corporation with an all cash transaction.[3][16][17]

On 26 September 2012, Chemtura entered into a Business Transfer Agreement (BTA) with Solaris ChemTech Industries Limited, an Indian Company, and Avantha Holdings Limited, an Indian Company and the parent company of Solaris ChemTech. As provided in the BTA, Chemtura agreed to purchase from Solaris certain assets used in the manufacture and distribution of bromine and bromine chemicals for cash consideration of $142 million and the assumption of certain liabilities.[15]

On 15 May 2013, Chemtura purchased the remaining 50% interest in DayStar Materials L.L.C. from its joint venture partner, UP Chemical Company. As a result, DayStar became a consolidated entity. The purchase price was $3 million in cash which approximated the fair value of the remaining share of the assets and liabilities, primarily inventory and fixed assets, as of the purchase date. In addition, Chemtura reimbursed UP Chemical for a $3 million loan they had made to DayStar.[15]

Divestitures[edit]

In April 2013, Chemtura completed the sale of its Antioxidant business to SK Blue Holdings, Ltd, and Addivant USA Holdings Corp. for $97 million, $9 million in preferred stock issued by Addivant and the assumption by SK and Addivant of pension, environmental and other liabilities totaling approximately $91 million. Additionally, Chemtura paid $2 million in cash as part of a pre-closing adjustment.

In December 2013, Chemtura completed sale of its Consumer Products business, including dedicated manufacturing plants in the United States and South Africa, to KIK Custom Products Inc. for $300 million and the assumption by KIK of pension and other liabilities totaling approximately $8 million.[15]

Finally, on 16 April 2014, Chemtura entered into a "Stock and Asset Purchase Agreement" to sell its Chemtura AgroSolutions business to Platform Specialty Products Corporation for approximately $1 billion, consisting of $950 million in cash and 2 million shares of Platform’s common stock. The sale became final on 3 November 2014.[15][18][19]

Restructuring[edit]

With the anticipated closure of the Antioxidant business manufacturing facility in Pedrengo, Italy in April 2012, the Pedrengo plant ceased operations on 31 March 2013. However, Chemtura still retains the property with the intention of using it later. On 31 December 2013, sale of the Consumer Products business was completed. In connection with the sale, Chemtura entered into a supply contract with KIK Custom Products, Inc to supply products from its Adrian, Michigan facility. Future plant closings are indicated for the Droitwich, United Kingdom facility with intention to move operations to the already operational Perth Amboy, NJ facility.[15]

2009 Bankruptcy[edit]

The corporation operated as a debtor-in-possession (DIP) under the protection of the United States Bankruptcy Court for the Southern District of New York from 10 March 2009 through 10 November 2010.[15][20][21]

Products and distribution channels[edit]

Chemtura operates in various industries including automotive, construction, electronics, lubricants, packaging, plastics for durable and non-durable goods and transportation[15] Most products are sold to industrial manufacturing customers for use as additives, ingredients or intermediates that add value to their end products. Additionally, the company considers itself a strong competitor in the global market, based on its ranking of its products within given sectors as defined by sector industries and operating segments.[3][4]

Business segments[edit]

The company currently has two reporting segments: Industrial Performance Products, includes the Petroleum Additives and Urethanes businesses; Industrial Engineered Products comprises the Great Lakes Specialties and Organometallic Specialties businesses.[22]

Industrial Performance Products[edit]

At the end of 2013 this segment had net sales of $979 million and marketed synthetic lubricants and greases, synthetic basestocks, lubricant additives, and urethanes.[22]

Industrial Engineered Products[edit]

At the end of 2013 this segment had net sales of $803 million and marketed brominated performance products, flame retardants, fumigants, and organometallics.[22]

Controversies involving Chemtura[edit]

The Chicago Tribune reports that researchers led by Stapleton and Heather Patisaul, a toxicologist at North Carolina State University, detected harmful effects at levels that were significantly lower than those used in the studies conducted for Chemtura, the Philadelphia-based company that makes Firemaster 550. It is reported that brominated chemicals, such as Firemaster 500 which were added to furniture in attempts to decrease flammability have leached out of the furniture. A 2013 Study by the MIND Institute of the University of California, Davis found that one component of the fire retardant chemical accumulated in human blood, fat and breast milk.[23]

Purportedly in response to the studies linking this class of chemicals to accumulation in humans and resulting potential harm, Governor Jerry Brown directed that the regulation phasing out flame retardant chemicals in furniture. In a press release, California Governor Brown stated “Toxic flame retardants are found in everything from high chairs to couches and a growing body of evidence suggests that these chemicals harm human health and the environment,” said Governor Brown. “We must find better ways to meet fire safety standards by reducing and eliminating—wherever possible—dangerous chemicals.” [24]

In November 2013 the Governor's Office announced publication of the new regulation In doing so, Governor Brown indicated that: "Numerous studies have found links between exposure to chemicals used as flame retardants in upholstered furniture and cancer and fertility issues. These chemicals also disproportionately impact children. One study found toddlers can have up to three times the level of flame retardants in their bodies as their parents." [25]

On January 15, 2013 Chemtura filed a lawsuit in Sacramento County Superior Court in an attempt to force the State of California to leave the old standard in place. In that lawsuit the company alleges that Chemtura will be irreparably harmed if the new regulation is not rescinded.

Countervailing views[edit]

Historically, to comply with California's fire safety laws, application of fire retardants has been key. However, Biophysical chemistry scientist Arlene Blum and her supporters have extensively campaigned to change California's fire safety laws, which are described as "strict". This includes California Technical Bulletin 117 (TB 117), implemented in 1975. Consequently, Blum's campaign has caused a review California's laws with the goal of prohibiting fire retardants that are used in products designed for home usage and furnishings.[26][27]

Also, Blum appears to be unable to accommodate the views of other scientists and fire-safety experts, who express a need for a rational inquiry of the fire-safety science underpinning flame retardants. They say Blum and her proponents “shout them down” at community information seminars, or decline to participate in discourse about the points of contention and the scientific research. Furthermore, Blum’s public message is seen as not accurate pertaining to flame retardant fire safety, and she is using a “high-visibility media campaign” that creates alarm in people concerning chemicals that have several decades’ usage. Such usage accounts for many lives saved from fire in their home, on a scale of tens of thousands in the United States.[26]

Blum says that a large body of studies exist which discuss the "toxicity" of flame retardant constituents. However, this is a "large and complex body of data" that also includes the effectiveness of flame retardants. Other analysis has resulted in other conclusions. Hence, it is unclear if Blum agrees or disagrees that other interpretations of this data are possible, while saying that she is not a fire scientist.[26]

For example, a countervailing scientific opinion is "exposure does not equal risk". Recently chemical analysis has been able to test particulates in household dust and in blood with more precision, stating that flame retardants exist "at levels of parts per billion." These are considered to be very low levels. Also, knowing the levels of chemicals found in human blood, of which there are often 70 or more, is necessary for accurate determination of health effects.[26][27]

Adverse effects of fire[edit]

The burden of fire on the U.S. economy is significant, comprising approximately $280 –$310 billion annually, or about 2 percent of the gross domestic product (GDP). Over the last 30 years, the number of reported fires, and the number of civilian fire deaths and injuries have decreased due to the efforts of many organizations. On the other hand, the number of civilian deaths and injuries normalized by the number of reported fires has essentially remained flat, while the number of firefighter injuries and fatalities has significantly increased on a per fire basis. Furthermore, the cost of fire protection has increased, and new and potentially costly threats to fire safety are emerging.[28]

Also, "in 2005 - 2009 U.S. fire departments responded to an average of 7,040 home structure fires per year in which upholstered furniture was the first item ignited. These fires caused an average of 500 civilian fire deaths, 890 civilian fire injuries, and $442 million in direct property damage. Upholstered furniture is the leading item first ignited in home fire deaths."[29]

Flame retardants[edit]

According to Mr. Marshall Moore, flame retardants are effective in reducing the flammability of synthetic materials. Also, the EPA has conducted an extensive assessment of new flame retardants, such as tetrabromobenzoate (TBB), to ensure that they are safe for use. Also, Chemtura has developed and introduced environmentally safer alternatives. These enable manufacturers to meet the strict fire-safety standards that government regulators and independent standards organizations have established. These safety standards protect the public by reducing the number and severity of fires involving families, homes, and businesses.[30]

Mr. Moore also says the EPA required a rigorous review of 2,3,4,5-tetrabromo-ethylhexylbenzoate (TBB), the brominated component of Firemaster 550. This has an improved environmental profile. In total, 15 studies were submitted to EPA during the course of the assessment of TBB. These include studies specifically designed to assess the potential exposure of consumers to the substance, as well as the persistence and potential for bioaccumulation. All of these studies were conducted at independent accredited laboratories following standardized methods. Based on these studies Chemtura scientists concluded, and the EPA agreed with these conclusions, that TBB is less persistent and less likely to bioaccumulate than the product it replaced.[30]

Polyurethane foam[edit]

Mr. Moore additionally says that by adding flame retardants to polyurethane foam ― which is highly flammable when left untreated ― the manufacturers of furnishings have been able to comply with a variety of standards worldwide, including those of California, which has the strictest standard in the United States. California Technical Bulletin 117, the formal name of the standard, was developed by the California Bureau of Home Furnishings through a consensus standards development process and first implemented in 1975. This regulation was intended to prevent ignition or slow the spread of the flame if the furniture is the first to ignite. When fires do occur, multiple studies show that foams treated with flame retardants burn much slower than untreated foam, giving occupants precious time to escape.[30]

National Bureau of Standards testing[edit]

In a 1988 test program was conducted by the former National Bureau of Standards (NBS), now the National Institute of Standards and Technology (NIST), to quantify the effects of fire retardant chemicals on total fire hazard. Five different types of products, each made from a different type of plastic were used. The products were made up in analogous fire-retardant (FR) and non-retarded variants (NFR).[31]

The impact of FR (flame retardant) materials on the survivability of the building occupants was assessed in two ways:

First, comparing the time until a domestic space is not fit for occupation in the burning room, known as "untenability"; this is applicable to the occupants of the burning room. Second, comparing the total production of heat, toxic gases, and smoke from the fire; this is applicable to occupants of the building remote from the room of fire origin.[31]

The time to untenability is judged by the time that is available to the occupants before either (a) room flashover occurs, or (b) untenability due to toxic gas production occurs. For the FR tests, the average available escape time was more than 15-fold greater than for the occupants of the room without fire retardants.

Hence, with regard to the production of combustion products,[31]

  • The amount of material consumed in the fire for the fire retardant (FR) tests was less than half the amount lost in the non-fire retardant (NFR) tests.
  • The FR tests indicated an amount of heat released from the fire which was 1/4 that released by the NFR tests.
  • The total quantities of toxic gases produced in the room fire tests, expressed in "CO equivalents," were 1/3 for the FR products, compared to the NFR ones.
  • The production of smoke was not significantly different between the room fire tests using NFR products and those with FR products.

Thus, in these tests, the fire retardant additives did decrease the overall fire hazard of their host products.

The above conclusions are specifically pertinent only to the materials actually examined. Thus, while it has been demonstrated that very significantly enhanced fire performance can be obtained with fire retarded products, such improvements are by no means to be automatically expected from all fire retarded products. Instead, it will still be necessary to test and evaluate proposed new systems individually. However, these tests do show that the proper selection of fire retardants can markedly improve the fire safety of specific products.[31]

Additionally, according to senator James M. Inhote, flame retardants are usually required to meet mandatory federal and state laws and standards. These chemicals are designed to protect household goods, including upholstered furniture. However, foam cushioning in upholstered furniture represents only 2-3% of the total flame retardant usage in plastic applications in North America. Flame retardants are designed to also protect electronics, cars, buildings, and airplanes. Flame retardants have been shown to reduce fire injuries and deaths in domestic dwellings and public places; and are one of many fire safety tools relied upon in homes and public places to reduce fire injuries and deaths. They have made a significant impact in fire safety despite the increased prevalence of flammable materials in day to day living.[32]

Lawsuit[edit]

In mid-January 2014, Chemtura filed a lawsuit against the state of California because Chemtura believes that the (California) Bureau of Electonics and Appliance Repair, Home Furnishings, and Thermal Insulation failed to comply with its legislative mandate by issuing a revised fire safety standard that does not address the risk of ignition from open flame ignition sources.[33][34]

External links[edit]

References[edit]

  1. ^ 2013 net sales of $2.2 billion reflects discontinued operations treatment for the completed sales of the Antioxidants and Consumer Produstc businesses. Chemtura 10K. Securities and Exchange Commission. 2013
  2. ^ a b Rudnick, Leslie R. (2009). Lubricant Additives: Chemistry and Applications, Second Edition. CRC Press (Taylor & Francis). pp. 40, 237, 238 (timeline), 439,. ISBN 9781420059649. 
  3. ^ a b c Plunkett, Jack W. (July 2008). Plunkett's Chemicals, Coatings & Plastics Industry Almanac 2009. Houston, Texas: Plunkett Research, Limited. ISBN 9781593921255. 
  4. ^ a b c d  This article incorporates public domain material from websites or documents of the United States Government. "FORM 10-K" (online - PDF). For the fiscal year ended December 31, 2013. U.S. Securities and Exchange Commission. 24 February 2014. Retrieved 19 May 2014. 
  5. ^ "Company & People". Wall Street Journal (Dow Jones & Company, Inc.). Retrieved 16 June 2014. 
  6. ^ "Financials". Wall Street Journal (Dow Jones & Company, Inc.). Retrieved 16 June 2014. 
  7. ^ a b c d "Historical Timeline". Chemtura Corporation. Retrieved 20 May 2014. 
  8. ^ "Crompton & Knowles Looms" (Free PDF download). Crompton and Knowles Loom Works Collection. Worcester Polytechnic Institute. 22 May 2013. Retrieved 25 May 2014. 
  9. ^ Pederson, Jay P. Gale Directory of Company Histories - Chemtura Corporation. International Directory of Company Histories 91. The Gale Group, Inc. ISSN 1557-0126. 
  10. ^ Somma, Ann Marie. "Charles Goodyear and the Vulcanization of Rubber". Connecticut History.org. Connecticut Humanities and University of Connecticut. Retrieved 25 May 2014. 
  11. ^ Simons, Martha Ann (16 February 2014). "Cradle of the Rubber Industry". The Naugatuck Historical Society. Retrieved 25 May 2014. 
  12. ^ NNDB (2012). "Witco Corporation" (Bibliography). Bibliography. Soylent Communications. Retrieved 19 May 2014. 
  13. ^ NNDB (2012). "Great Lakes Chemical". Bibliography. Soylent Communications. Retrieved 19 May 2014. 
  14. ^ "Company Overview of Witco Corporation". Bloomberg Business Week. 2014. Retrieved 19 May 2014. 
  15. ^ a b c d e f g h  This article incorporates public domain material from websites or documents of the United States Government. Quarterly Report, Chemtura Corporation (30 April 2014). "Form 10-Q" (Free PDF download). For the quarterly period ended March 31, 2014. Securities and Exchange Commission. pp. 6–10. Retrieved 24 May 2014. 
  16. ^ "Chemtura Completes Acquisition of Kaufman Holdings Corporation". OEM/ Lube News (Lubrication Technologies, Inc.). 5 February 2007. Retrieved 16 June 2014. 
  17. ^ "Kaufman Holdings - Acquisition Completed". Chemtura News & Events (Chemtura Corporation). 30 January 2007. Retrieved 16 June 2014. Press release.
  18. ^ Tan, Gillan (16 April 2014). "Chemtura to Sell Agrochemicals Business". Wall Street Journal (Dow Jones & Company, Inc.). Retrieved 15 June 2014. 
  19. ^ "Chemtura Completes Sale of Its Agrochemicals Business to Platform Specialty Products Corporation" (Press release). The Wall Street Journal. 3 November 2014. Retrieved 22 December 2014. 
  20. ^ Dealbook (19 March 2009). "Chemtura Files for Bankruptcy". New York Times (New York City: The New York Times Company). Retrieved 24 May 2014. 
  21. ^ De la Merced, Micheal J. (6 March 2009). "Chemtura Hires Restructuring Advisers". New York Times (New York City: The New York Times Company). Retrieved 24 May 2014. 
  22. ^ a b c  This article incorporates public domain material from websites or documents of the United States Government. "FORM 10-K" (online - PDF). For the fiscal year ended December 31, 2013. U.S. Securities and Exchange Commission. 24 February 2014. pp. 7–11. Retrieved 19 May 2014. 
  23. ^ Dan Moraine, Chemical Industry Insider Comes Out, Sacramento Bee, January 26, 2014
  24. ^ Press Release, 6/18/12 Office of the Governor, http://gov.ca.gov/news.php?id=17598
  25. ^ Press Release, 11/21/2013 Office of the Governor, http://gov.ca.gov/news.php?id=18301
  26. ^ a b c d Schulz, William G. (29 October 2012). "Ablaze Over Furniture Fires". Chemical & Engineering News 90 (44) (American Chemical Society). pp. 28–33. Retrieved 29 May 2014. 
  27. ^ a b Schulz, William G. (29 October 2012). "Fighting Fires". Chemical & Engineering News 90 (44) (American Chemical Society). p. 27. Retrieved 29 May 2014. 
  28. ^ Hamins, Anthony P.; Averill, Jason D. et al. (18 April 2012), "Reducing the Risk of Fire in Building and Communities: A Strategic Roadmap to Guide and Prioritize Research" (Free PDF download available.), Fire Research Division Engineering Laboratory (NIST Special Publication 1130): 123–126 
  29. ^ Ahrens, Marty (1 August 2011), Home Fires That Began With Upholstered Furniture, Quincy, MA: NFPA, Fire Analysis & Research, retrieved 30 May 2014 
  30. ^ a b c  This article incorporates public domain material from websites or documents of the United States Government. Senate subcommittee: Superfund, Toxics and Environmental Health (24 July 2012). "Written Testimony of Mr. Marshall Moore" (Free PDF download). Oversight of EPA Authorities and Actions to Control Exposures to Toxic Chemicals. United States Senate. Retrieved 30 May 2014. 
  31. ^ a b c d  This article incorporates public domain material from websites or documents of the National Institute of Standards and Technology. Babrauskas, V.; Harris, R. H; Gann, R. G; et al. (July 1989), "Fire Hazard Comparison of Fire-Retarded and Non-Fire-Retarded Products" (Free PDF download available), NBS Special Publication 749 (U.S. Commerce Dept. National Bureau of Standards (NBS)), retrieved 30 May 2014 
  32. ^  This article incorporates public domain material from websites or documents of the United States Government. Senate subcommittee: Superfund, Toxics and Environmental Health (24 July 2012). "Statement of James M. Inhofe". Oversight of EPA Authorities and Actions to Control Exposures to Toxic Chemicals. United States Senate. Retrieved 25 May 2014. 
  33. ^ Lee, Stephanie M. (17 January 2014). "Flame-retardant maker sues over new Calif. law". SF Gate (Hearst Communications, Inc.). Retrieved 1 June 2014. 
  34. ^ "California Sued Over New Flame Retardant Standards". CBS Sacramento (CBS Radio, Inc.). 17 January 2014. Retrieved 1 June 2014.