NEWS OF THE WEEK NONPROLIFERATION
PUTTING WEAPONS OUT OF HARM'S WAY ON THE WAY George W. Bush and Vladimir Putin met one-on-one during G-8 summit, which saw a pledge of $20 billion to Russia.
G-8 nations will provide Russia with $20 billion in decommissioning aid
A
$ 2 0 BILLION PLEDGE TO
fund efforts to halt the proliferation of weapons of mass destruction, primarily in Russia, was agreed to by the Group
of Eight industrial nations at their June 27 summit meeting in western Canada. During the next 10 years, the G-8 nations—Britain, Canada, France, Germany, Italy, Japan, Russia, and the U.S.—agreed to support specific cooperative projects that address weapons nonproliferation, disarmament, counterterrorism, and nuclear safety, according to a statement. Half of the $20 billion is to come from the U.S., and the rest is to be apportioned among the other nations, although details were not spelled out. Curbing terrorists was the primary concern, the national leaders said, and top priority was giv-
BUSINESS
CROMPTON SELLS SPECIALTIES Long-awaited deal will help Crompton move toward reducing high debt loads
I
Calarco 10
C&EN
T HAS TAKEN MORE THAN TWO
years, but Crompton Corp. has finally found a buyer for its industrial specialties business: Akzo Nobel. This deal and another expected soon will help Crompton reduce its debt load of approximately $1.4 billion, but not by enough for analysts. Akzo Nobel paid $95 million to acquire the specialties business, which had 2001 sales of $165 million, much ofwhich were in agricultural surfactants sold to Monsanto to formulate the her-
/JULY
8,
2002
bicide Roundup. Akzo says the "bolt-on" acquisition strengthens its presence in agricultural chemicals and oil-field surfactants. "This sale represents an important step in our portfolio realignment and debt-reduction activities," says Cromptoris CEO, Vincent A. Calarco. John E. Roberts, senior vice president at Buckingham Research Group, in New^brk City says Crompton actually got a good deal. Earnings for the business—about $3 million in 2001—
en to destruction of chemical weapons, dismantlement of decommissioned nuclear submarines, disposal of fissile materials, and employment of former weapons scientists. The need to gain worldwide financial backing for a Russian nonproliferation program stretches back to the Clinton Administration, but President George W. Bush has made nuclear, chemical, and biological weapons nonproliferation a growing concern ofhis Administration, particularly given the increasing U.S. and international focus on combating terrorism (C&EN, Jan. 14, page 19). The program's initial focus will be on Russia, but it could be broadened in the future to include more nations, such as other former Soviet states. Russia is expected to bring forward a list ofpossible projects for funding, while the G-8 nations will have a range offinancialoptions for payment, including retirement ofpart of the Soviet-era debt they hold in lieu of actual compensation.-JEFF JOHNSON are fairly low, so "Crompton sold the business at a high multiple to earnings." But Roberts also notes that, while the sale is "a step in the right direction, Crompton still has to reduce debt a lot." Cash from the sale—along with cash from the expected sale of the petrolatum and white oils business and a $50 million tax refund—will reduce debt by $250 million to about $1.1 billion at year's end. Deutsche Bank credit analyst Joseph Princiotta says Crompton's deal with Akzo "is agood first step toward cutting debt and restoring an investment-grade profile." But credit-rating agency Standard & Poor's says it anticipated the specialties sale in the company's current BBB— rating, which indicates merely adequate ability to repay debt. And it could downgrade the rating ifbusiness conditions deteriorate.-MARC REISCH HTTP://PUBS.ACS.ORG/CEN
