Orica Sells Surfactants Business

23rd December, 1998

Orica Limited today announced the sale of its Surfactants business to Huntsman Corporation for $155 million.

The sale price includes a 10 year interest bearing deferred settlement of $20 million. Payment of the deferred amount is subject to the business achieving certain performance targets.

The Surfactants business markets a range of detergents and emulsifiers for numerous agricultural, domestic and industrial cleaning, personal care and food applications. It operates a manufacturing facility on Orica's complex at Botany, New South Wales. It has annual sales of approximately $150 million and employs around 180 people.

When announcing the sale Orica managing director and chief executive officer, Philip Weickhardt said: "While Surfactants has been a sound business for our company for many years, its value to Orica's shareholders can best be realised by selling to a more natural long term owner. Many Surfactants customers are global players who are increasingly looking for global suppliers with global technology."

Mr Weickhardt emphasised Orica's commitment to its four core business platforms of mining services, agricultural chemicals, consumer products and chemicals. "We will continue to invest for growth in those business areas where we have a long term sustainable competitive advantage. The proceeds of this divestment will further enhance our capacity to invest in our areas of greatest strength" he said.

Orica's after tax profit on the sale will be approximately $26 million.

Huntsman Corporation is a US based chemical company with worldwide sales of approximately US$5 billion. It has an existing Australian operation which manufactures styrene and phenolic resins at its plant in West Footscray, Victoria.

Orica Surfactants' Specialty Chemicals plant at Deer Park, Victoria is not included in the sale. This facility is important to the Explosives and Chemicals businesses and will be retained by Orica.

The sale was completed on signing.