Purchase of Koppers Chemical hits snag Beazer's $660 million deal to sell Koppers Chemical Co. to its own management and chemicals entrepreneur Gordon A. Cain has fallen apart. A disagreement over reserves to cover potential environmental liabilities killed the agreement. A Koppers company spokesman says that other buyers have expressed interest in acquiring Koppers Chemical, but adds it is "too early to say" who those potential buyers may be. Both Koppers Chemical management and Cain declined to comment on the collapse of the deal. Beazer acquired Pittsburgh-based Koppers Co. for $1.8 billion after a contentious and noisy fight in June (C&EN, June 6, page 6). Cain and the investment banking group he heads are veterans of the spectacular buy-outs that resulted in the formation of Vista Chemical, Sterling Chemical, and Cain Chemical. The group agreed to act as key equity partner along with Koppers Chemical management to buy the chemical unit in July (C&EN, July 11, page 5). Brian C. Beazer, chairman of the British construction firm, which wants to retain only the 60% of the company involved in construction, says that he now hopes to sell the chemical unit "at a substantially higher" price. Insiders say that price could now go as high as $700 million for the unit, whose 1987 sales were $606 million. Any subsequent deal, however, will have to take account of Koppers Chemical's environmental liabilities. The original letter of intent between Beazer, Koppers Chemical management, and the Sterling Group is said to have provided a $40 million letter of credit to cover past environmental damage. Cain and his group were said to have demanded that Beazer provide a $100 million letter of credit. Koppers Co. filings with the Securities & Exchange Commission discloses that the company is currently involved in "the investigation and/ or remediation of" 37 third-party landfill sites to which it has shipped
waste products for disposal. In addition, 32 other formerly owned and operated sites are subject to investigations and cleanups. The company's filings state that compliance with environmental regulations "has had and will continue to have a substantial adverse effect on the company's financial performance." And it admits that "the eventual effect of the laws and regulations
and their potential costs is not determinable at this time." As of Dec. 31, 1987, the date of Koppers 10K filing with SEC, "Koppers had established in excess of $60 million in environmental reserves on its balance sheet" to account for "costs likely to arise" from "environmental administrative proceedings and litigation." Marc Reisch
Iraqi use of chemical arms condemned again United Nations efforts to mediate peace in the Persian Gulf war are being stymied in part by Iraq's persistent use of chemical weapons against Iran. Just a day after the UN confirmed Iraqi use of these weapons of mass destruction in a battle that took place last June, Iran charged Iraq with using them in a new attack on Aug. 2. A mere 24-hours earlier, a UN special investigating team had reported Iraqi use of chemical weapons in the Persian Gulf war was "intensifying" and becoming "more frequent." The UN report was the fifth verification and condemnation of such use since 1984. Though Iraq signed the 1925 Geneva Protocol banning the wartime use of chemical weapons, it has continued to violate the treaty almost with impunity. And the fear is that Iraq's behavior "increases the risk of their use in future conflicts," write experts Erik Dahlgren of Sweden and Manuel Dominguez of Spain in their report to the UN. Iran for its part says it has the capability to make the weapons but has not used them in the Gulf War. After a four-day investigation at an alleged battle zone in Iran in early July, Dahlgren and Dominguez were able to confirm the use of sulfur mustard gas [bis-(2-chloroethyl)sulfide] medically and by chemical analysis. Clinical examination of some patients confirmed the use of toxic organophosphorus compounds, but chemical analyses could not confirm the use of nerve gas (possibly Tabun) or cyanide. These compounds dissipate rapidly, especially at high temperatures found at the battle zone. The experts did not arrive on-site in a timely fashion to
collect viable samples for analyses in laboratories in Switzerland and Sweden. According to Iranians, Iraqi use of nerve gas has been limited to the front line to aid the advance of attacking troops. Longer-lived mustard gas has been used against rear echelons to prevent counterattacks. Shortly after investigating Iranian allegations, the two-man team went to a war zone in Iraq. Medical evidence indicated that nine Iraqis had been exposed to sulfur mustard gas. Chemical analyses showed the presence of mustard gas in grenade fragments taken from one battle zone but not in fragments taken from another. The grenades were said to be of Iranian origin. The fear that chemical weapons will be used in future conflicts points to the need for a verifiable chemical weapons treaty. Such an effort is now languishing in the
Mother and baby are among victims of Iraqi chemical attack on Iraqi village ofHalabja, a Kurdish stronghold August 8, 1988 C&EN
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