Business Strategy Ashland to Focus on Specialty Ingredients for Creating Premier Specialty Chemicals Company
The company intends to evaluate its Composites segment, BDO manufacturing facility in Germany along with related merchant Intermediates and Solvents (I&S) products in order to eliminate stranded costs from potential sale of these assets.
Kentucky/USA – Ashland Global Holdings has recently announced the next step on its path towards creating the premier specialty chemicals company, with a more streamlined portfolio focused on specialty ingredients and improved margins that should generate enhanced value for shareholders.
Ashland announced that it will explore strategic alternatives for its composites segment, as well as for the butanediol (BDO) manufacturing facility in Marl, Germany, and related merchant Intermediates and Solvents (I&S) products. Ashland intends to evaluate all options with respect to these assets, including a potential sale. The company plans to retain its BDO plant in Lima, Ohio, to ensure consistent supply for Ashland’s internal needs.
The company expects to use proceeds from a possible sale of these assets primarily for debt reduction and share repurchases. Ashland’s board of directors has approved a new 1 billion dollar share repurchase authorization to provide flexibility. The new authorization replaces the previous authorization which had approximately 500 million dollars remaining. Ashland intends to take action to eliminate stranded costs from a potential sale, consistent with similar past transactions.
If Ashland decides to sell these assets, it would expect to sign an agreement by the end of calendar year 2018. Ashland has retained Citi to assist in this strategic review process.