NEWSOFTHEWEEK EUROPEAN
BUSINESS
CLARIANT UNVEILS RESTRUCTURE PLAN Sale of several businesses aims to cut debt, boost profits
A
FTER FOUNDERING SINCE
its 2 0 0 0 acquisition of BTP, Clariant has embarked upon a wide-reaching
transformation to reestablish itself as a leading specialty chemicals company Clariant, which reported a net
Lôsser
DRUG
loss of $36 million for the first half of 2003, will sell two major businesses—cellulose ethers and electronic materials—and several other unnamed operations. The units to be sold account for about 15 to 20% of total sales. And in presenting Clariant's first-half results last week, CEO Roland Lôsser, who took over the post in March, waved warning flags about several other units— life sciences and textile dyes, in particular— that are underperforming. After considering all other options, he said, the firm has decided that internal restructuring is the first priority for these units. In life sciences, which is largely the former BTP, Lôsser announced that Clariant would close four agrochemical plants in
DISCOVERY
Bridging The Gap In California
F
ive California research institutions have formed a consortium aimed at moving potential drugs out of the state's laboratories and into the arms of the pharmaceutical industry. PharmaSTART—for BioPharmaceutical Support for Translating & Advancing Research & Technology—is led by SRI International, a nonprofit research institute, and includes Stanford University, the University of California campuses in San Diego and San Francisco, and the UCSF campus of the California Institute for Quantitative Biomedical Research. Glenn Rice, vice president of SRI's Biosciences Division, explains that California's universities, research institutes, and small companies are developing promising drugs, but many of them can't bridge the gap to the marketplace because they are seen as risky
6
C&EN
/ AUGUST
11, 2003
investments by venture capitalists and big pharmaceutical companies. At the same time, he says, the drugs' developers aren't equipped to perform the FDA-compliant tasks required to start clinical trials on their own. PharmaSTART seeks to make such drugs more attractive to potential investors by helping developers demonstrate the drugs' safety and preliminary efficacy. SRI is committing an initial half-million dollars and more than a thousand hours of consulting time to helping university scientists create drug development plans that follow FDA guidelines. SRI will also help developers find funding programs and navigate the web of government procurement regulations and procedures. And as a group, PharmaSTART will promote collaboration among member organizations, particularly on funding initiatives.—MICHAEL MCCOY
the U.S. and Germany resulting in the elimination of about 2 0 0 jobs. And the company added that "job losses throughout the whole of Clariant will be unavoidable" because of other costcutting actions. Lôsser said he wants to focus Clariant on businesses where it can combine its strong customer service capabilities with its leading-edge surface and color technologies. He cited its plastics masterbatches, performance and process chemicals, textile chemicals, and coatings units as successful examples of such businesses. The businesses Clariant has decided to sell either are not central to the company's new focus, carry high investment requirements, or cannot achieve leading market positions, Lôsser said. The aim of the divestment program—which Lôsser expects to have wrapped up by the end of 2004—is to raise some $1.1 billion. Initial proceeds are expected within nine months, by which time net debt will have fallen to below $1.9 billion, from $2.7 billion now The firm's first-half loss came on sales of $3.2 billion, down 7% (although up 2% in local currencies). The loss reflected an exceptional charge of $105 million relating to the previously announced closure of a bleach activator plant in the U.S. (C&EN June 23, page 14). Excluding that, Clariant showed a profit of $69 million, compared with $108 million in first-half 2002. The results for the first half also reflected savings ofnearly $45 million from cost-reduction measures launched at the beginning of the second quarter. "We are not satisfied with these results," Lôsser said. "They underline our determination to refocus the company and significantly improve our performance over both the short and long term." Any gains will come solely from the company's own efforts, he added. "We expect little or no help for the rest of 2003 from a market environment that remains difficult."—PATRICIA SHORT HTTP://WWW.CEN-ONLINE.ORG
