Survey says: Solvay is one of top 10 largest chemical manufacturers worldwide. The company joined those ranks after acquiring Rhodia in 2012. Today, the company produces and sells a balanced portfolio of plastics (specialty polymers and vinyls) and chemicals (basic and specialty). About one-third of that portfolio are products used in sustainable development. End markets for its products are diverse and include agriculture, automotive, consumer goods, construction, electronics, energy, environment, and water. With some 110 plants in 55 countries, Europe is Solvay's largest market, followed by North America, Latin America, and Asia/Pacific.
Mergers and Acquisitions
Solvay had a pivotal year in 2011 when it acquired France's Rhodia in a friendly tender offer for $4.8 billion. The deal doubled the size of Solvay's business and strengthened its presence in fast-growing emerging markets like Brazil, China, and India.
The company today operates in three major segments: Rhodia, Plastics, and Chemicals. Rhodia is a global leader in the development and production of specialty chemicals, such as cellulose acetate, engineering plastics, and fluorinated compounds. The group's Plastics segment is a major producer of specialty polymers and vinyls. Its Chemicals segment is the largest producer of soda ash, hydrogen peroxide, and sodium bicarbonate.
Buoyed by the Rhodia acquisition, the company's proforma group sales grew by 14% (in local currency) in 2011. The increase represented steady growth in sales volumes for each of the group's activities (Chemicals, up 4%; Plastics, up 2%; and Rhodia, up 3%). Solvay's net income plunged to €296 million in 2011 compared to €1.8 billion in 2010, a figure that was boosted by the sale of the company's pharmaceuticals unit as acquisition and restructuring costs took their toll.
With the acquisition of Rhodia and the sale of its pharmaceutical activities in 2011, Solvay is setting itself up to be a major player in sustainable chemistry. It is taking steps to strengthen its footprint in fast-growing countries and develop greener value-added products through capital investments, acquisitions, joint ventures, and R&D partnerships.
In 2011, for example, Solvay sought growth in the Asia/Pacific region by establishing a partnership to create a soda ash plant in China; setting up a joint R&D center in South Korea to test a new fluorine technology that can reduce emissions during solar cell and semiconductor manufacturing; and commissioning the world's largest hydrogen peroxide plant in Thailand. In the Middle East, plans to build a similar hydrogen peroxide megaplant are under way through a joint venture with Saudi Arabia's Sadara Chemical Company -- a JV between Saudi Aramco and Dow Chemical.
In Russia, Solvay and Russian firm SIBUR formed a joint venture called Ruspav in 2012 to produce surfactants and oilfield process chemicals. The venture's plant, to be located located near SIBUR's petrochemicals operations east of Moscow, is expected to be up and running in 2015.
Meanwhile, to increase its leadership in energy efficiency and emissions reduction, Solvay acquired Société Générale's stake in Orbeo, formerly a 50/50 joint venture between the two companies that focused on carbon-trading markets. Orbeo is now a subsidiary of Rhodia Energy and is called Orbeo Climate Care. The acquisition is meant to speed up development of projects to curb greenhouse gas emissions. – less