Rhodia sells silicones business to China National BlueStar Corporation

Rhodia has announced the finalization of the sale of its silicones business to China National BlueStar Corporation.

This business generated sales of €417 million in 2005 and has a total of 1,200 employees. It is mainly situated in Europe, with major production sites at Saint-Fons and Roussillon, in France.

In addition, the Group sold Rhodia Organics’ SulfuricProducts activity to Adisseo, subsidiary of China National BlueStar Corporation. This business generated sales of €47 million in 2005 and has a total of 67 employees. It is based at Les Roches de Condrieu, in France.

Rhodia CEO Jean-Pierre Clamadieu said: ‘This divestment constitutes the last step of the plan we launched in 2003 to restore profitability and to focus the Group’s portfolio on businesses in which we hold strong leadership positions. This will contribute further to the Group’s debt reduction. Q4 2006 was strong compared to Q4 2005 and therefore we will be in a position to exceed our 2006 objectives. Despite a raw material and energy price environment that remains volatile, the start of 2007 gives me full confidence that the Group will continue on its route of profitable growth.’

China National BlueStar (Group) Corporation is a large state-owned enterprise, which is a specialized subsidiary of Chem China Group Corporation. Headquartered in Beijing, being a leading company in China’s chemical industry, BlueStar filled many technology blanks in the fields of new chemical materials, such as organic silicon, engineering plastics and TDI as well as special chemical products and realized its scale production. In 2005, the total asset of BlueStar exceeded RMB 30 billion and the sales revenue reached as much as RMB 30 billion.