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BUSINESS
Shortly after announcing its financial results for 2002--a $477 million net loss, following extraordinary charges--Clariant has decided to suspend its dividend and sell noncore businesses. Clariant showed a net loss as a result of $656 million in charges associated with its acquisition of fine chemicals company BTP in 2000. If the write-down is excluded, the company shows a profit of $179 million. Clariant says the write-down came as developments in its life sciences units did not meet expectations. Last year, the company divested its European emulsions business, its worldwide emulsion powders business, and its North American hydrosulfite operations. Now, it says, businesses that are not core activities--some 7% of sales--will be sold off. Capacities in Clariant's pharmaceuticals and custom synthesis business units will be substantially scaled back, the company says. And those two units and its electronic materials business unit, as well as its masterbatches division, will be transformed into legal entities, opening up the possibility of spinning off these operations. Moreover, as part of a review of the company's capital structure, Clariant management is mulling the issuing of new shares to overcome a decline in equity capital caused by the extraordinary charges and negative currency effects. Any concrete proposals, the company said, would be announced within the month. |
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