The chemical company Lanxess, led by CEO Matthias Zachert (56), is selling its business related to customized plastics and resins for around half a billion euros to the Japanese UBE Corporation. With this sale, the company announced the completion of its exit from the polymer business, as stated by Lanxess, listed on the MDax, in Cologne on Thursday.
The proceeds from the sale will be used to reduce debt. Lanxess estimated the value of the business unit at 460 million euros. The transaction is expected to be completed in the first half of 2025. The upcoming sale of Lanxess’ polyurethane division weighed down on the shares of the specialty chemicals company on Thursday.
The Urethane Systems business includes, according to the company, five production sites and laboratories in the USA, Europe, and China. All facilities with around 400 employees will be taken over by UBE Corporation. In the past twelve months until June 2024, the business generated around 250 million euros in revenue.
In November 2023, Lanxess had already announced its intention to sell Urethane Systems. The division, as the last remaining plastic business unit, no longer aligns with Lanxess’ focus as a pure specialty chemicals company.
Lanxess under pressure
Lanxess aims to permanently reduce its annual costs by around 150 million euros starting in 2025. This includes the elimination of 870 positions, with 460 of them in Germany.
The decision to sell the Urethane Systems business marks a strategic shift for Lanxess as it streamlines its operations and focuses on its core specialty chemicals business. This move reflects the company’s commitment to enhancing its competitiveness and financial performance in a rapidly evolving market.
By divesting non-core assets and optimizing its cost structure, Lanxess is positioning itself for long-term success and sustainable growth. The sale to UBE Corporation represents a significant step in this strategic realignment and is expected to create value for both companies involved.
As Lanxess continues to adapt to changing market dynamics and customer needs, the company remains dedicated to delivering innovative solutions and driving technological advancements in the specialty chemicals industry. The sale of Urethane Systems underscores Lanxess’ commitment to staying agile and responsive in a competitive global marketplace.
