Evonik announced last week that it will exit its Performance Materials business unit, which supplies some intermediate chemicals used to make lubricant additives and lubricants. The chemical company is keeping other units, including its Specialty Additives business, which contains most of its activities in the lubes industry.
The May 11 statement described the divestment as a step in a strategy to make the company more sustainable and to reduce its environmental impact. The company, which is based in Essen, Germany, has not yet found a buyer or buyers for the Performance Materials unit but said proceeds will help it increase investment in products with sustainability benefits and technologies to help avoid carbon dioxide emissions.
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Officials did not offer a timeline for the divestment.
Evonik is one of the world’s largest suppliers of lubricant additives, offering polymethacrylate viscosity index improvers and viscosity modifiers, along with components such as defoamers, emulsifiers and corrosion inhibitors.
The Performance Materials division – which accounted for €2.9 billion of Evonik’s €15 billion sales revenue in 2021 – has three divisions: Performance Intermediates; Superabsorbents; and Functional Solutions. Performance Intermediates products include isobutene derivatives, used to produce lubricants and lubricant additives.
Officials said they expect the activities being divested to thrive.
“The businesses we are withdrawing from on strategic grounds are being optimally set up to give them a responsible route to a good future,” Christian Kullmann, chairman of Evonik’s executive board, told investors and analysts at the company’s Capital Markets Day.
Specialty Additives includes two business lines relating to lubricants – Oil Additives, and Interface & Performance. Evonik pitches its lube additives activities as green and sustainable based on their helping to improve fuel economy and flow efficiency of automotive and industrial lubricants.
By 2030, Evonik aims to invest more than €3 billion (U.S. $3.2 billion) in what it terms “Next Generation Solutions,” meaning products with superior sustainability benefits. That would represent around 80 percent of annual growth investments. In the same period, the company would invest a further €700 million in “Next Generation Technologies,” towards optimization of production processes and infrastructure to avoid carbon dioxide emissions.