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CHC Elastogran, a local producer and distributor of polyurethane (PU) basic products and systems in South Africa and Sub-Saharan Africa, has announced a change in name to Elastogran South Africa after strengthening its existing alignment with its majority shareholder Elastogran, a member of the BASF Group.

Headed by Managing Director, Andrew Bailey, Elastogran South Africa’s expertise in PU technologies is well recognised across the industry.

Explains Andrew Bailey: “The existing CHC Group shareholding remains intact as CHC is a very strong partner in our business. Our association with Elastogran gives us the ability to leverage superior technology opportunities that will benefit our local customers. Elastogran is known throughout Europe as the market and technology leader for PU systems and PU special elastomers.”

Says Dr Uwe Hartwig, Managing Director of Elastogran (Germany): “Coupled with outstanding technological capabilities, capacity and infrastructure, we set world-class industry standards; Elastogran has more than 40 years’ experience in the industry.”

In 2005, the CHC Group and the Elastogran Group first announced the merger of their PU businesses (CHC Urethane Products and Elastogran).

The change in name to Elastogran South Africa is a result of a natural progression that developed over two years since the joint venture was announced. The decision confirms Elastogran’s confidence in the South
African market.

Elastogran’s competitive advantage lies in its ability to produce tailor-made PU solutions that meet customers’ needs and specifications. Advantages include sufficient stock levels in achieving an efficient supply chain to the end-user.

As a result of recent economic growth in the local manufacturing sectors including the automotive, appliance, furniture & bedding, footwear, construction and mining industries, many positive opportunities exist for South Africa and Sub-Saharan Africa to access world-class PU technologies and raw materials. Elastogran South Africa is gearing up its internal operations and infrastructure in meeting global best practice standards to maximize opportunities.

The recent implementation of a common IT standard business solution by Elastogran South Africa ensures constant improvement of flow and speed of information, ensuring cost savings and improved business practices. Elastogran South Africa’s SAP successful integration went live with its SAP R/3 project in April.

Concludes Andrew: “The benefits to local customers are tangible. By upgrading our internal operations and infrastructure, we are able to help our customers be more successful.”

Background:

The Elastogran Group, majority shareholder of Elastogran South Africa, is a member of the BASF Group and is a market and technology leader in PU systems. It develops, produces and distributes thermoplastic and cellular elastomers as highly refined specialty materials throughout Europe. It comprises twelve PU system houses.

Elastogran South Africa (previously CHC Elastogran) is responsible for the production and distribution of PU raw materials and systems in South Africa and Sub-Saharan Africa. Its broad expertise in PU technologies is well recognised across the industry.

The CHC Group (minority shareholder) is a leading manufacturer and distributor in the chemical, plastic, mining and construction industries.

The Group serves the industry through its operating companies: CH Chemicals, CHC Films, CHC Global, CHC Polymerworld, CHC Resources, CHC Amnion and Elastogran SA (CHC Elastogran). Principals include Dow Chemical, Beijing Hengju, SABIC (General Electric), LG International, ExxonMobil and UPPC.

The Group's activities are coordinated from its Head Office in Gauteng with offices and warehouse facilities in Durban, Cape Town and Port Elizabeth and also operates in East Africa (Kenya) .

It has an annual turnover in excess of 100 million US dollars and employs more than 230 people.

Contact person:
Andrew Bailey
Elastogran South Africa
Managing Director
Tel nr 011 876 6702
andrew.bailey@elastogran.co.za

Directors promoting their personal interests at the expense of companies in breach of their fiduciary duties will suffer severe legal consequences. The High Court of South Africa handed down a judgement in favour of CH Chemicals (CHC) against its previous MD and the business he set up while MD of CHC, says Neil Hellmann, CEO of CHC Group.

The judgement, in favour of CHC, concluded a seven-year legal dispute against Jose Duarte Coelho Da Silva, Resinex Plastics (Pty) Ltd (currently known as Ultrapolymers) and Resinex Southern Africa (Pty) Ltd (the holding company of Plastomark), the latter being the second and third defendants.

Judge W.L. Seriti of the High Court of South Africa found that Da Silva, a Chartered Accountant, breached his fiduciary duties towards CH Chemicals of which he was the MD and colluded with Joaquim Schoch (previously with Dow Plastics) and Benoit De Keyser (Resinex NV, the Belgium Holding Company now called Ultrapolymer NV and associated with the Ravago Group) to remove Dow's plastics business from CH Chemicals and to give it to Resinex Plastics (now Ultrapolymers).

Evidence was obtained through an Anton Pillar application about a joint business venture contract that was entered into between Da Silva and Resinex NV to set up the second and third defendants businesses while Da Silva was an employee and MD of CHC. Computer records were recovered evidencing overseas trips and meetings with companies against the instruction of the chairman of CHC. The Court also heard evidence of Jose Da Silva and Joaquim Schoch going on holiday to Namibia, about secret meetings, numerous telephone calls to competitors and cryptic e-mail messages.

The judgement referred negatively to the credibility of Da Silva, Joaquim Schoch and Beniot De Keyser. Rejecting Da Silva’s testimony the Court found that his evidence was unreliable. The evidence was contrary to the probabilities. The Court further said that it could not rely on the evidence of Joaquim Schoch who contradicted himself on a number of occasions and who was part of the secret meetings with Da Silva and Beniot De Keyser.

The Court found that the second and third defendants were both the unlawful product of but also the vehicles by which the first defendant (Da Silva) perpetrated his own misconduct against the plaintiff (CHC).

“Second and third defendants benefited from the wrongful conduct of the first defendant. Without the assistance of the second and third defendants, the first defendant would not have been in a position to compromise the interests of the plaintiff to the extent he did. First, second and third defendants are joint wrongdoers.”

In the judgement on 30 January 2007 the Court ruled that Da Silva, Resinex Plastics (now known as Ultrapolymers) and Resinex Southern Africa are jointly and severally liable for the damages suffered by CHC. They are being held to account for profits in these businesses as well as damages. The amount claimed is approximately R80 million (USD 12 million). The claim will, however, be accurately quantified, in due course, after comprehensive investigation. The first, second and third defendants are also to pay for the legal costs of CHC. The Court also ruled that in the light of the documents recovered as a result of the Anton Pillar application, and the findings in the case, the costs of the Anton Pillar application should also be awarded to CHC.

Concludes Hellmann: “At CHC integrity is our most important value. The outcome of this court case is a victory for Integrity which CHC will continue to uphold and we will not tolerate any breaches.”

Issued by:
CHC Group Communication Manager
Riana Sinden
Tel +27 (0) 876-6719 or 083-659-6155


Download a copy of the judgment:

Judgment - Pages 1 to 60 (2MB)
Judgment - Pages 61 to 120 (2MB)
Judgment - Pages 121 to 193 (2MB)

A variety of products - used by consumers daily - have two things in common. One is soda ash, a strategic raw material, used in the manufacturing process. The other is the risk that an increase in the price of soda ash will create a tsunami-like cost escalation across the board for hard-pressed consumers.

Neil Hellmann, CEO of CHC Group

Soda ash (sodium carbonate or NA2CO3), an alkaline chemical, is a key ingredient in products as diverse as beer bottles, beverage glasses, candle wax, paper products, windows, vehicle windscreens, soaps, washing powder and detergents, medicines, food additives and photographic chemicals.

When taking into consideration that soda ash is used to manufacture indispensable consumables such as glass, candle wax and washing detergent, it is clear that consumers have every reason to be concerned about the Competition Commission’s findings on the Botash/ANSAC case (which is still pending after seven years).

In fact, the drawn out battle between South Africa’s main suppliers of soda ash is set to continue for a while yet.

Locally, soda ash came into the spotlight back in 1999 when Botash, which exports soda ash from Botswana to South Africa, lodged a complaint with the Competition Commission that the ANSAC price for soda ash “was too low” alternatively, that ANSAC was a cartel raising prices in South Africa – clearly contradictory complaints. It was apparent then, as it is now, that Botash's real concern is the competition it faces from ANSAC. Botash's objective is to exclude ANSAC from the market leaving it as a near monopoly – free to raise prices.

ANSAC is a legitimate joint venture between several American producers of soda ash to reduce costs and promote exports. It was formed in 1984 under the Webb Pommerene Act in the USA. Its product is currently sold in South Africa by CHC Global, a BEE company in the CHC Group.

The shareholders of Botash are the Botswana Government, Anglo American Corporation, AECI (Chemserve) and De Beers.

Says Reshaan Laljith, MD of CHC Global: “Soda ash is a strategic chemical that is a common element in a wide range of manufacturing processes. Bringing in high quality soda ash at a highly competitive price is helping to keep costs down in many sectors of the South African economy.”

Just as an increase in the price of petrol and diesel has a far-reaching impact on prices across a wide spectrum of products, the ripple effect caused by an increase of soda ash prices in the manufacturing of glass, candles and washing powder will inevitably hurt the pocket of the man on the street, says Laljith.

Neil Hellmann, CEO of CHC Group, further explains that ANSAC’s access to high-grade soda ash deposits, economies of scale and operational efficiencies means that highly competitive prices can be offered to the benefit of South African consumers. Without the sharing of costs, risks and worldwide trade volumes that ANSAC’s members achieve through ANSAC, it would not be possible for American soda ash to reach the South African market at a competitive price.

“Seen from this perspective, we are absolutely astonished that we are accused of supplying soda ash at a price which is ‘too low’. It is actually ironic, even confusing, to be accused of bringing competition into the market and lowering prices. From a supplier and consumer perspective, the situation makes no sense,” argues Hellmann.

Deposits of sodium carbonate are found in large quantities in countries such as the United States, China, Botswana, Kenya, Peru, India, Egypt, Tanzania and Turkey. It is found both as extensive beds of sodium minerals and as sodium-rich waters (brines). Soda ash is also manufactured synthetically in many parts of the world.

The world market for soda ash is approximately 48 million metric tonnes, of which approximately 10 million metric tonnes is produced in America, 6 million metric tonnes is consumed in the US with 4 million tonnes being exported. The South African market consumes about 400 000 metric tonnes per annum.

Issued on behalf of CHC Global and the CHC Group

Enquiries:
Riana Sinden
Group Corporate Communication Manager
Tel nr 011 876 6719
Cell nr 083 659 6155

JOHANNESBURG – August 2005: Every day, 2.1 million South African passengers travel on Metrorail’s 379 train sets, consisting of 4635 carriages, using 470 stations, all connected by 2400km of track. As Metrorail’s mission is to ensure the safety of their train drivers and passengers, they decided embark on a “reglazing programme” for selected commuter trains in 1986, which has been ongoing ever since. This is where CHC Polymerworld’s John MacKenzie was called in to share his expertise gleaned from 24 years of being responsible for the Lexan® polycarbonate sheet business in South Africa.

The reglazing programme involves replacing glass windows with Lexan®, a product of GE Advanced Materials, in passenger coaches and also Lexan Margard windscreens for the train drivers on certain routes where window breakages due to vandalism were on the increase. Futhermore, where Lexan materials are used, the windows are often intact in the unlikely event of a train crash, enhancing passenger safety.

“During testing we actually hurled a face brick at a train traveling at 120 km per hour, and the brick bounced off the windscreen, proving that Lexan Margard is the strongest, transparent glazing material to exist. Lexan Margard is just one product of the sheet range provided by GE Advanced Materials, and has a clear coating that provides the abrasion-resistant properties of glass. There is nothing stronger that still allows you to see through it!” explains John.

CHC is pleased to be a major supplier of the Lexan glazing material used by manufacturers of the windows and windscreens for Metrorail’s reglazing programme.

Metrorail anticipates that the programme run for a further five years with 5000 passenger commuter coaches being upgraded.


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CHC Group is a leading manufacturer and distributor in the chemical, plastic, mining and construction industries. The Group serves the industry through its nine entities: CH Chemicals, CHC Films, CHC Global, CHC Polymerworld, CHC Resources , CHC Urethane Products, CHC East Coast Africa, CHC Australia and CHC New Zealand. Principals include BASF, Dow Chemicals, Beijing Hengju, General Electric Advanced Materials, LG International, ExxonMobil and UPPC. The Group’s activities are coordinated from the Head Office in Johannesburg, with offices and warehouse facilities in Durban, Cape Town and Port Elizabeth. The Group also operates in East Africa (Kenya) and in Australasia (New Zealand and Australia). CHC has an annual turnover in excess of 100 million US dollars and employs some 275 people.

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Press Enquiries:
Group Corporate Communication Manager
Tel. 011-876 6719
Fax. 011-255 2919
Email. rsinden@chcgroup.co.za

JOHANNESBURG – July 2005: CHC Polymerworld has acquired the Moldex 3D Flow Analysis software from Coretech System Company, Republic of China. In addition, CHC has been appointed as the accredited vendor for the package in Southern Africa.

The new software will enable the user to accurately predict the flow of the polymer into the mould and provide empirical values for shrinkage and warpage as well as highlighting problem areas such as weld line location and quality, air entrapment, areas of high shear stress and hesitation. The predictive capability of the software will eliminate expensive mould changes often necessary when utilizing highly crystalline materials and can be used for failure analysis on existing problem products/moulds.

Moldex 3D includes a comprehensive materials database of over 5600 polymer grades, the capability of creating new material models from PVT data, a library of injection moulding machines where the model and mould data can be downloaded. In addition, features such as stepped injection, phased holding pressure, cascade filling can all be activated and conditions optimized. For costing purposes, the software is invaluable in giving absolute values for product mass, clamping force requirement and cycle time.

“With Moldex 3D on board, we have expanded our service capability and our ability to provide our customers with effective design and processing advice together with our traditional materials solutions to offer the total package.” says John Algate, Technical Manager.

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CHC Group is a leading manufacturer and distributor in the chemical, plastic, mining and construction industries. The Group serves the industry through its nine entities: CH Chemicals, CHC Films, CHC Global, CHC Polymerworld, CHC Resources , CHC Urethane Products, CHC East Coast Africa, CHC Australia and CHC New Zealand. Principals include BASF, Dow Chemicals, Beijing Hengju, General Electric Advanced Materials, LG International, ExxonMobil and UPPC. The Group’s activities are coordinated from the Head Office in Johannesburg, with offices and warehouse facilities in Durban, Cape Town and Port Elizabeth. The Group also operates in East Africa (Kenya) and in Australasia (New Zealand and Australia). CHC has an annual turnover in excess of 100 million US dollars and employs some 275 people.
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Press Enquiries:
Group Corporate Communication Manager
Tel. 011-876 6719
Fax. 011-255 2919
Email. rsinden@chcgroup.co.za

JOHANNESBURG – June 2005: CHC recently provided Frigoglass with a 100% water blown polyurethane refrigeration insulation system that cost-effectively meets the Montreal Protocol’s requirement of phasing out of the use of ozone depleting compounds.

Frigoglass, a leading manufacturer of commercial fridges, are suppliers to Coca-Cola and SAB amongst other companies. The company approached CHC for an alternative environmentally friendly refrigeration insulation solution to the very expensive HFC (Hydrofluorocarbon) technology most commonly used in the United States and the Cyclopentane technology used in Europe. CHC’s innovative solution is a first for South Africa.

“CHC’s 100% water blown system does not require a blowing agent and uses only CO2. Although the density of the material used is higher, the absence of HFCs makes this solution more cost-effective. The technology also has excellent process and flow ability, and the fine cell structure of the rigid foam adequately provides the insulation needed by commercial fridges,” explains Paul Clavel, Technical Manager.

CHC’s extensive refrigeration knowledge and technical know-how enabled the company not only to provide the product, but also to envisage a complete solution for Frigoglass.

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CHC Group is a leading manufacturer and distributor in the chemical, plastic, mining and construction industries. The Group serves the industry through its nine entities: CH Chemicals, CHC Films, CHC Global, CHC Polymerworld, CHC Resources , CHC Urethane Products, CHC East Coast Africa, CHC Australia and CHC New Zealand. Principals include BASF, Dow Chemicals, Beijing Hengju, General Electric Advanced Materials, LG International, ExxonMobil and UPPC. The Group’s activities are coordinated from the Head Office in Johannesburg, with offices and warehouse facilities in Durban, Cape Town and Port Elizabeth. The Group also operates in East Africa (Kenya) and in Australasia (New Zealand and Australia). CHC has an annual turnover in excess of 100 million US dollars and employs some 275 people.

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Press Enquiries:
Group Corporate Communication Manager
Tel. 011-876 6719
Fax. 011-255 2919
Email. rsinden@chcgroup.co.za

JOHANNESBURG – October 2005: The Elastogran Group and the South-African company CHC Urethane Products (Pty) Ltd. have agreed to found a Polyurethane (PU) System House as a joint venture in South Africa subject to the approval of the competition authorities.

Andrew Bailey, MD of CHC Urethane Products with Neil Hellmann, CHC Group MD (sitting) announce the merger of the Urethanes business with BASF's Elastogran.

The joint venture company, to be called CHC Elastogran, will be responsible for the production and distribution of polyurethane systems and PU raw materials in South Africa and Sub-Saharan Africa. The new company will employ some 50 people and is based in Elandsfontein, Johannesburg. CHC Elastogran is to be headed by Andrew Bailey as Managing Director.

“By founding CHC Elastogran we are continuing our successful strategy of a customer-oriented market approach by creating independent, decentralized PU System Houses. The polyurethanes market in South Africa represents high growth potential which will greatly help to strengthen our competitiveness in the international market,” says Dr. Helmut Rödder, Spokesperson of the Management Board Elastogran.

“In a steadily growing market, the CHC Elastogran joint venture will allow us to be in a better position to respond to the changes and opportunities out there. CHC Elastogran will have the advantage of having direct access to essential raw materials! This, along with the combined R&D technological capabilities of its partners, will place the company in a strong position for growth into the future” says Neil Hellmann, Group Managing Director, CHC Group.

By the formation of the joint venture, Elastogran and BASF's corporate sector for polyurethanes delivers the goal in South Africa and Sub-Saharan Africa of being close to the customer for the marketing of raw materials processed to systems by a local system house. The customers are mainly from the appliance, automotive, furniture and bedding, construction and building, and mining industries. Here CHC Urethane Products has built a strong market position. In addition, CHC Elastogran will invest in additional manufacturing capacity in order to meet ambitious growth plans so as to establish a leading presence in the Sub-Saharan Africa market.

PU raw materials and systems belong to the core competence of BASF with about 30 system houses worldwide. The PU business of BASF in Europe is already operated by Elastogran companies in Germany, France, England, Italy, Russia, Spain, Sweden and Hungary. “The new JV will improve the market position of the BASF Group in Southern Africa. Elastogran and CHC are perfect partners for the business development in forward-looking industries” says Dr. Thorsten Iske, Head of BASF Business Center SA & Sub-Sahara.

For the customers in the region South Africa the integration of the PU System House into the Product-and-Know-how-Verbund of the Elastogran Group and of the BASF has a further advantage.

Elastogran is a member of the BASF Group. The Elastogran Group, a market and technology leader in polyurethane systems and special elastomers, comprises nine European affiliates. Elastogran supplies BASF base materials for polyurethane throughout Europe and develops, produces and distributes polyurethane systems as well as special thermoplastic (Elastollanâ) and cellular (Cellastoâ) elastomers as highly refined specialty materials. In 2004 Elastogran generated a net sales of €1,53 billion (consolidated) together with a staff of approximately 1,800.

CHC Urethane Products is a leading manufacturer and supplier of rigid and flexible foam systems, as well as elastomers systems in South Africa. The company supplies polyurethane systems to the appliance, automotive, furniture and bedding, construction and building, and mining industries. The company has ISO 9001:2000 accreditation.