Albemarle enters Middle East venture

• By GARY PERILLOUX
• Advocate business writer
• Published: Oct 28, 2009 - Page: 6B

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Albemarle Corp. will produce chemical refining catalysts in a new Middle East joint venture, the company said Tuesday.

Albemarle’s chief executive, Mark Rohr, said his Baton Rouge company would contribute $80 million to build the catalyst facility with Ibn Hayyan Plastic Co. in the Arabian Gulf industrial city of Al-Jubail. That company is part of the Saudi Basic Industries Corp.

The project will begin this quarter and open in 2012. In conference calls with analysts Tuesday, Rohr said the deal won’t boost Albemarle’s global production of tri-ethyl aluminum significantly. But it would place 6,000 metric tons a year directly into a region where the chemical infrastructure is expanding rapidly.

In a news release, Mohamed Al-Mady — chief executive of the parent Saudi company — said the facility would provide “strategically needed security for the supply of tri-ethyl aluminum, which is critically required for our multibillion-dollar polyolefins industry.”

Albemarle made the announcement in conjunction with a conference call about its third-quarter earnings, released Monday.

Though its sales of $1.45 billion for the first three quarters of 2009 are about 26 percent off last year’s pace, Albemarle beat analyst consensus estimates of 55 cents a share by 2 cents for the quarter.

Rohr said he feels bullish about 2010 and is comfortable with analyst estimates of $2.39 a share for the full year in 2010. He also said that in 2011 the company should be back to what it expected 2009 to look like before recession set in.

Throughout 2009, Albemarle has cut costs in its global operations and hopes to reach $160 million in savings by next year.

By the end of the third quarter, the company had achieved $85 million in savings, said Luke Kissam, the Albemarle executive vice president overseeing the restructuring.

Part of that savings will come through reorganization of its European operations.

The company has conducted employee meetings with workers in The Netherlands and Germany, where further consolidation is expected, company officials said in the conference call.

Albemarle expects to take $10 million to $15 million in one-time charges against earnings in the next few quarters for those changes. Kissam said the company is establishing a transaction center in Budapest, Hungary, that will consolidate some financial functions worldwide.

Earlier this month, the company said that might mean up to eight jobs being cut from the work force in Baton Rouge, where about 75 jobs were eliminated earlier this year.