Intellectual Thoughts by Sanjay Panda: Solvay to Acquire Rhodia

Solvay to Acquire Rhodia

Solvay has agreed to acquire Rhodia for €3.4 billion in cash and  expects to close the deal in late August 2011 subject to antitrust approval both  in Europe and the U.S. The merged entity will retain Solvay’s name.

The merged company will have combined sales of more than  €12 billion/year.  Solvay posted sales of €7.1 billion and Rhodia posted sales of €5.23 billion in 2010. About 40% of combined sales will be in emerging markets.  Solvay expects transaction should create synergies leading to annualized cost savings of €250 million within three years.

About 90% of the combined company's sales will be generated by businesses in which it has a top-three position worldwide. In Solvay's case, these businesses include specialty polymers, soda ash, and hydrogen peroxide. For Rhodia these include silica, rare earths, surfactants, acetate and nylon-6,6 engineering plastics. 


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