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Du Pont, Dow form venture.

Du Pont and Dow Chemical have signed a letter of intent to form an enterprise that would include a broad portfolio of general purpose and specialty elastomer products. Combined global elastomers sales for the two companies currently are about $1 billion; the new enterprise would have the potential for growth at more than twice the industry rate, leading to total revenues of $2 billion within five years.

The enterprise would include the discovery, development, production and sale of thermoset and thermoplastic elastomer products used primarily in the automotive, general rubber, wire and cable, construction, molded goods, durable adhesives, and oil and polymer modification markets. A decision to proceed with formation of the enterprise will follow the normal evaluation process, negotiation of a definitive agreement and notification of appropriate governmental authorities.

The enterprise would combine Du Pont's leadership position in synthetic rubber with Insite technology, a proprietary catalysis technology developed by Dow. Du Pont introduced Neoprene, the world's first synthetic elastomer, over 60 years ago and has remained a leader in elastomers research and development, production and marketing. Insite technology -- the world's most advanced metallocene chemistry -- will have broad applicability in future elastomer product development. The combination of the companies' technological and marketing capabilities would provide customers with a more competitive range of products than is currently available.

One area of focus is ethylene propylene diene (EPDM) and related ethylene octene (EO) and ethylene propylene (EP) elastomers. Under a joint development agreement, work is proceeding to explore the use of Insite technology to produce EPDM for all market application areas. The companies expect that the technology will provide improved quality, superior polymer architectural capability and significant cost advantages compared to conventional processes.

The two companies are also exploring various production options, including the modification of an existing Dow polyethylene unit, to manufacture EPDM. The goal is for a unit to come on stream in late-1996 with annual capacity of 200 million pounds.

EPDM is the fastest growing, large-volume synthetic elastomer, with an annual growth rate of 5 to 6%. It is used primarily in wire and cable, automotive and industrial hoses, single-ply roofing, gaskets and seals, and oil and polymer modification.

"Our intention is to create an enterprise that has superior product offerings throughout the entire elastomer performance spectrum. Combining the science of Du Pont and Dow will greatly enhance our ability to meet evolving customer needs on a global basis," said Donald K Duncan, director and general manager, Du Pont Elastomers. "The possibility for superior elastomer products from Dow's and Du Pont's combined strengths is unlimited. This enterprise could herald a new era in elastomers.

"The potential for a technology-driven, customer-oriented enterprise with an entrepreneurial culture offering a wide range of elastomers that span the performance spectrum is exciting," said Edwin F. Gambrell, Dow global vice president, Insite Business Platform.

Du Pont and Dow bring a great deal of expertise, advanced technology and market resources to industries using synthetic elastomer products," said Edgar S. Woolard, Du Pont chairman. `This is another example of Du Pont's commitment to ensure that our businesses have the best opportunity to thrive and grow in today's highly competitive global business environment."

Commenting on the proposed enterprise, Frank P. Popoff, Dow chairman, said, "We have long been impressed with the strength of Du Pont's elastomers franchise. The product offerings available through this impending enterprise will sustain the strength of that franchise through an ability to serve customer needs in a superior fashion.

"Du Pont is a research and technology-based global chemical and energy company offering high-performance products based on chemicals, polymers, fibers and petroleum. Dow is a diversified, worldwide manufacturer and supplier of more than 2,000 product families, which include chemicals and performance products, plastics, hydrocarbons and energy, and consumer specialties.
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Title Annotation:Dow Chemical
Publication:Rubber World
Date:Feb 1, 1995
Previous Article:Rubber consumption tops 3 million mt.
Next Article:Dynamic properties of rubber.

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