Columbia-based W.R. Grace & Co. said Friday that it has agreed to buy a Dow Chemical Co. division for $500 million.
Grace is paying cash for Dow's Unipol polypropylene licensing and catalysts business, including a Louisiana manufacturing plant. Dow said it expects about 90 of its employees will transfer to Grace, and Grace will honor existing contracts.
For chemical giant Dow, the sale is part of a strategy to get rid of "assets that are no longer a strategic fit," according to its announcement. The Michigan company plans to shed nearly $1.5 billion of the company's businesses by the end of next year.
Grace, meanwhile, has acquired businesses throughout its long bankruptcy, though this purchase is the largest. It filed for Chapter 11 protection 12 years ago in the face of asbestos claims and has said it believes it will finally emerge from bankruptcy by the end of this year.
Grace said the polypropylene purchase "is a significant enhancement" of its catalysts niche, which include polyethylene and polypropylene resins used in plastic film, food packaging and plastic pipe. The acquisition moves the company to the No. 2 spot in the polypropelene catalysts and licensing market behind LyondellBasell, said Rich Badmington, a Grace spokesman.
"It's really a rare opportunity to acquire a catalyst business of this size and quality," Badmington said. "For us, it's a very strong strategic fit."