Chemphil waives right to buy partner’s stake in joint venture

The Chemphil Group will waive its right of first refusal to buy out the shareholdings of Rhodia Consumer Specialties Ltd. in their joint venture firm Chemphil Albright & Wilson Corp. (CAWC).

The company said this is premised on Rhodia’s offering the same number of shares to third parties at a price and terms of the sale not more favorable than those offered to the company.

Rhodia’s over 120.536 million shares in CAWC are valued at $3.58 million.

As the country’s biggest source of chemical products in the country, the Chemphil Group has, over the years, expanded into general insurance, chemical bulk storage, personal care products, agribusiness and real estate.

However, the onset of the financial crisis in 1997 did not spare the group’s businesses from the general slack in demand, causing its major units to slump in the red – forcing the holding company to undertake a massive restructuring plan that would involve the sale of certain assets and the spin-off of non-core units.

Rhodia, one of the world’s major manufacturers of phosphates and surfactants – among the major ingredients for detergents – is a major partner in CAWC, the Philippines’ first and only manufacturer of technical grade sodium tri-polyphosphates and tetra-sodium pyrophosphates.

The Pasig-based plant has also gone into the production of food grade phosphoric acid as well as carbon dioxide for the food and beverage industries.

Recently, Chemphil chopped off its agribusiness operations to prevent further losses in this field, one of the first casualties in the group-wide restructuring strategy.