www.ushalonbank.com  1.800.433.1751                                                  October 2013 - Vol 2, Issue 30           
In This Issue
End of an Era at DuPont?
Siemens to Cut 15,000
UTC Avoids Layoffs Over Gov't Shutdown
UL Mulls 1211 Future
EPA Meets with HFC Stakeholders
FAA/Industry Grapple with Halon Replacement
Obituaries - John Lawlor (1/2/30-8/20/13) and Philip DiNenno (7/23/53-8/28/24)
Did You Know?
Most Popular Stories from July 2013
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The Air Up There: DuPont Debates Chemical Future

By John Demeter

This summer, DuPont announced a strategic review of its Performance Chemicals segment, including its Fluorine Enterprise, the segment where FM-200 and their other fire protection products reside. Usually big companies like DuPont announce a sale, or intent to sell, with a splash, while the internal reviews and strategizing are, well, internal. This makes DuPont's summer announcement curious and different. They have not announced an actual intent to sell.

Performance Chemicals, at $7.2 billion in sales, is DuPont's second largest division after seeds and agriculture, and represents 20% of the company's sales and a third of its operating income. In 2008, they bought the FM-200 business from Chemtura, but the past few years, the company has been reviewing and revising its portfolio of business; increasing its focus on bio-based nutrition, seed, and agricultural enterprises. In 2011 DuPont purchased Danisco, an industrial enzyme and food ingredients firm, for $6.6 billion and, earlier in 2013, sold off the automotive coatings business to the Carlyle Group for $4.9 billion.

The Performance Chemicals Segment is made up of the DuPont Titanium Dioxide business, a leading supplier of white pigments; and DuPont Chemicals and Fluoroproducts (DC&F). DC&F has three parts:  Chemical Solutions, a diverse platform of industrial chemicals; the Fluoropolymer business, including the well-known Teflon brand; and the Fluorochemicals division, manufacturer of refrigeration fluids, propellants, foam expansion agents, and the fire extinguishing products.

In a letter to key customers, DuPont confirmed the strategic review of Performance Chemicals underway, and the inclusion of the Fire Extinguishants business as part of that $7+ billion platform. No changes were envisioned to the ongoing business operations, personnel, or products as a result of the review and for now it sounds like business as usual.

Inside big corporations everything is always for sale - at the right price. "Strategic Review" is often a corporate euphemism for the effort to figure out what a business is worth to the company - and if it might be worth more to someone else. At $7 billion, this would be a whopper of a sale. Finding some other large corporate creature with the cash and interest, and willingness to wrangle the global antitrust issues, will be a challenge. If the decision is to sell, spinning all or parts off as an IPO or selling to a capital investor is a more likely outcome.

In 2012, the Carlyle Group's purchase of the DuPont coatings business was the largest deal in the chemical industry and may have fueled the fire for additional hot deals between DuPont and the private equity markets. Several private equity firms, including Carlyle, SK Capital, Bain, Apollo, and others, are showing a growing interest in buying businesses that have become noncore for their parent corporations, but still hold strong market share and growth opportunities with the right investments.

Or the review could show DuPont there is gold to be found in those core businesses with the right investments from the company. There is, however, that bit about Nelson Peltz, an activist investor, amassing a large chunk of DuPont stock. Nothing like having a pirate wandering the halls of HQ to get the folks in the C-suite packing up the silver.

Watch this space for more to come.

End of an Era at DuPont?
This titanium dioxide plant in Taiwan is part of DuPont's performance chemicals division.


July 29, 2013


RESTRUCTURING: CEO Kullman says older chemical businesses no longer fit with firm's science strategy


Citing volatility and few growth prospects, Dupont says it will divest a big portion og its traditional chemical business, including its storied Teflon fluoropolymers brand and its industry-leading titanium dioxide pigment unit.


The company is exploring "strategic options" for its performance chemicals segment, a process that could mean a sale or a spin-off. The division includes well-known DuPont brands such as Teflon nonstick coatings, Nafion ion-exchange membranes, and Suva refrigerants. It also makes industrial chemicals such as aniline, sulfuric acid, and glycolic acid.


Click here to read the rest of the article. 


Siemens to Cut 15,000
Siemens AG Chief Executive Officer Joe Kaeser was promoted to lead the company in August after working as chief financial officer for seven years.
 Photographer: Guenter Schiffmann/Bloomberg

Siemens AG (SIE)'s new Chief Executive Officer Joe Kaeser is widening job cuts from an initial plan after the failure to catch up in profitability with rivals General Electric Co. (GE:US) and ABB Ltd. (ABBN) cost his predecessor the job.


The company will eliminate 15,000 posts, representing 4 percent of its 370,000 workers worldwide, and a third of the reduction will come in the German home market, Oliver Santen, a Siemens spokesman, said by phone yesterday. He declined to give more regional details. Siemens, Europe's largest engineering company, had first projected some 8,000 job cuts globally, a person familiar with the program told Bloomberg in October 2012.


Former CEO Peter Loescher lost his post following a July 25 announcement that the Munich-based company won't meet a goal of profit representing 12 percent of sales next year. The target involved 6.3 billion euros ($8.5 billion) in savings at Siemens, which has faced mounting charges for failed power and train projects.

"If you see a billion euros in charges this year, that pretty much lines up with 15,000 job cuts," Andreas Willi, a London-based analyst at JPMorgan Chase & Co. who has a neutral recommendation on Siemens stock, said by phone yesterday. "There have been charges in drive technologies, power generation and transmissions, so you expect them to bear the weight."


Click here to read the full article. 



UTC Avoids Layoffs Over Gov't Shutdown

Temporary layoffs expected to cascade out of United Technologies Corp. were canceled after U.S. Secretary of Defense Chuck Hagel on Saturday recalled most of the Pentagon's furloughed civilian employees.


With the first round private sector furloughs scheduled to begin Monday at Sikorsky and Maryland-based Lockheed Martin, attorneys at the Pentagon concluded that the law doesn't permit the type of blanket furlough of all civilian employees, including the on-site defense inspectors.


Pentagon employees make up the majority of the 800,000 federal workers furloughed during the shutdown that began last Tuesday after Congress failed to pass a measure to fund the federal government. The defense secretary said its recall of employees would affect most of the department's workers.


Read the full article here


UL Mulls 1211 Future


Report of the Meeting to Discuss the Withdrawal of CAN/ULC S512 and the Plan to Cease Listing of Halon Extinguishers


A meeting on this subject which was held at the ULC Office in Toronto, Ontario and online on July 17, 2013. 


Read the full report here . 


EPA Meets with HFC Stakeholders

August 26, 2013 

On August 22, EPA held a meeting with representatives of industry and environmental NGOs to discuss the potential for the Agency to use its authority under the SNAP program to further the goal of reducing emissions of HFCs. About a hundred people attended the meeting, which was held at the Capital Hilton in Washington DC.  Speaking for EPA were Sarah Dunham (Director of the Office of Atmospheric Programs), Drusilla Hufford (Director of the Stratospheric Protection Division), and Cindy Newberg (Branch Chief).

EPA began the meeting by reviewing the President's Climate Action Plan that was announced in June.  Part of the plan directs EPA to use its authority under the SNAP program "to encourage private-sector investment in low-emissions technology by identifying and approving climate-friendly chemicals while prohibiting certain uses of the most harmful chemical alternatives."  EPA is seeking input from stakeholders on how they can address these two goals.

Click here to read the full report. 

FAA/Industry Grapple with Halon Replacement

Halogenated hydrocarbons (Halons) are the principal fire extinguishing agent used in civil aviation. Due to the significant Ozone Depleting Potential (ODP) of Halons, their production was banned per the Montreal Protocol, an international treaty which phased out worldwide production by 1999. These provisions were adopted in the United States through the Clean Air Act, which provides broad statutory authority for the U.S. Environmental Protection Agency (EPA) to implement and enforce regulations to reduce the effects of ozone depleting substances.

Read the full memo here.

Obituaries - John Lawlor (1/2/30-8/20/13) and Philip DiNenno (7/23/53-8/28/24)

John Henry Lawlor
January 2, 1930 - August 20, 2013
Founder of Keystone Fire Protection Co.

Philip Joseph DiNenno
July 23, 1953 - August 18, 2013
HARC's friend and colleague

Read more about both here.


FSSA Annunciator
September 2013

FSSA 2014 Annual Forum Registration is Open

The FSSA 32nd Annual Forum registration is now open.  Mark your calendar for February 22 - 25, 2014 in San Diego, CA.


Click here to make your reservation now.


Book your hotel reservations now at the Loews Coronado Bay Resort by calling 1-800-815-6397 and mention the FSSA Room Block.  FSSA has a special group rate of $219/per night.

Bernie Bischoff Turns 88

Bernie Bischoff recently turned 88 in July!  If you wish to send your condolences their address is below.


PO Box 13430
1170 Bower Hill Road, # 515
Pitttsburgh, PA 15243

FSSA Training Program

The FSSA Training program is live!  If you reserved a spot at the forum invoices were emailed in May. For questions regarding the training program or to reserve your space, please contact Vince Mullhausen  at FSSA HQ.

Did You Know?
  • Over 4 million pounds of halon 1301 is currently in place protecting the worldwide commercial aviation fleet.

Most Popular Stories from July 2013  


If you have any questions, comments, would like to be featured in a future Halon Herald, or would like to be added to our mailing list for this newsletter, please contact Kari Buser at kbuser@ushalonbank.com.


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