Crompton, GE swap organosilicones, specialty chemicals businesses

MIDDLEBURY, Conn. (April 24)—Crompton Corp. has agreed to sell its OSi Specialties organosilicones business to General Electric Co. in return for GE's Specialty Chemicals business and $645 million in cash, the companies said. The OSi business is described as a leading global supplier of organofunctional silanes—a coupling agent used in a variety of applications, including the compounding of silica and rubber—and includes Crompton's urethane foam surfactants unit. The deal will enable Crompton to reduce debt significantly, sharpen its strategic focus and provide flexibility for organic growth initiatives, according to Vincent Calarco, chairman, president and CEO. "We are building a stronger GE Silicones business that will deliver better technologies and application development services to our global customers," said William Woodburn, president and CEO of GE Specialty Materials. "We are focusing our investment in platforms where we can win and grow for the long term." Crompton also will receive quarterly "earn-out" payments for three years based on the combined performance of GE's existing silicones business and the OSi unit it is acquiring from Crompton. This will be worth a minimum of $105 million and a maximum of $250 million payable quarterly over a three-year period, the group said.