Bloomberg News

Solvay to Scrutinize Vinyls in CEO Review, Morgan Stanley Says

March 02, 2012

Solvay SA (SOLB), which bought specialty chemical maker Rhodia for $6.4 billion in 2011, will probably look at its vinyls unit as Chief Executive Officer Jean-Pierre Clamadieu studies disposals, Morgan Stanley (MS) analysts said.

Special chemicals, energy services and parts of Solvay’s polyamide business will also be under the spotlight in the company’s review of its businesses, Peter Mackey, a London-based analyst at Morgan Stanley, said in a research report.

Clamadieu, who is scheduled to outline his growth strategy at an investors’ meeting on April 24, will probably need until the end of 2012 to complete his assessment of all divisions of Brussels-based Solvay and produce a blueprint for the company’s future makeup, said Mackey, who has an “overweight” recommendation on the company’s shares.

Erik de Leye, a spokesman for the company, declined to comment.

The manufacturer’s founding family, which owns about 31 percent of the company, is “actively encouraging” Clamadieu to reorganize, in contrast to the common perception that members are acting as a barrier to change, Mackey said.

Clamadieu, the former CEO of Rhodia who took on the top job at Solvay as the two companies merged, “was recruited specifically to drive a refocusing of the Solvay group,” Mackey said. The CEO has made it clear that there are “no sacred cows in the portfolio” and that the added size of the enlarged company makes it easier to consider making changes, according to the analyst.

To contact the reporter on this story: Andrew Noel in London at anoel@bloomberg.net

To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net


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