Cytec and DSM Announce Termination of Melamine Joint Venture
Monday July 31, 9:00 am ET
WEST PATERSON, N.J.--(BUSINESS WIRE)--July 31, 2006--Cytec Industries Inc. and Royal DSM N.V. announced today that agreement had been reached for the early termination of their 50/50 manufacturing joint venture American Melamine Industries ("AMEL") as well as the dismissal of all legal action between the parties concerning this joint venture.
Upon closing of the transaction, which is expected on August 1, 2006, Cytec will assume 100% ownership of the assets and liabilities of AMEL and receive $7.4 million (approximately EUR 5.9 million) for releasing all past and future obligations under various partnership agreements.
David Lilley, Cytec Chairman, President and Chief Executive Officer stated, "We are pleased to have entered into this latest agreement with DSM, our long-term partner in melamine manufacturing. Since being formed in 1986, we have worked closely with DSM and very much respect their decision to end our joint venture. We will continue to operate the melamine plant for both our internal use and sale to third party customers." Commenting on Cytec's earnings, Lilley stated, "The payment to be received roughly approximates cost reimbursements which we had expected to receive from DSM from mid-year through year-end and thus the receipt of this payment does not materially impact our most recent earnings forecast dated July 20, 2006."
Jan Zuidam, DSM Deputy Chairman stated, "We are also pleased to have worked out an amicable agreement with Cytec. We have a long standing relationship with Cytec encompassing many business areas and we look forward to continue working with them. It goes without saying that we will continue to serve our melamine customers in the Americas in the same way as before from our other plants in the world."
Source: Cytec Industries Inc.
Engineering News Archive