GSK welcome UK tax change

UK drugmaker GlaxoSmithKline (GSK) has responded to new UK government tax plans by promising to invest £500 million in manufacturing projects. The government will introduce a ‘patent box’ that will reduce the rate of corporation tax on profits generated from intellectual property (IP) in the hope that this will encourage investment in research and development. GSK welcomed the plan, saying it would build its next biopharmaceutical manufacturing plant in the UK and establish a new £50 million UK venture capital fund for investment in early-stage healthcare companies and university spin outs. In addition, the company said it would contribute to a new green chemistry unit at the University of Nottingham, UK, with a ‘significant financial contribution’ to this project. The company estimates that these investments will lead to the creation of 1000 new UK jobs. The patent box will apply from April 2013. The tax rate on profits generated from IP will be reduced to 10 per cent. In the October spending review, the government said it would reduce the main rate of corporation tax from 28 per cent to 24 per cent over four years from 2011.

In other GSK news, the company says it will increase its stake in biotech Theravance. The two have agreed that GSK will buy 5.8 million Theravance shares at a price of $22.50 (£14.40) per share – a total investment of $129,375,000. The transaction is scheduled to close later today. This will boost the GSK stake to 15 million shares – 19 per cent of Theravance.

Merck appoints new CEO

Kenneth Frazier

US pharma major Merck & Co has appointed Kenneth Frazier chief executive, effective 1 January 2011. Frazier will succeed Richard Clark, who has been chief executive since 2005 and will continue to be chairman of the board. He was executive vice president and president of global human health from 2007 to 2010.


Süd-Chemie catalyst investment

German speciality chemical company Süd-Chemie has said it will invest up to €20 million (£17 million) in catalyst research at the Technische Universitaet Muenchen (TUM). The company will provide up to €2 million per year for at least the ten years. The work will cover the development of new catalysts and methods of preparation, focusing on making base chemicals from carbon dioxide and olefins from non-petrochemical feed stocks.

BASF-Ineos styrenic deal

Privately-owned chemical giant Ineos intends to combine its styrenic businesses with those of German chemical major BASF. The deal includes the styrene monomer, polystyrene, acrylonitrile butadiene styrene and styrene-based copolymer parts, but excludes expandable polystyrene. Each company will have a 50 per cent stake in Styrolution, expected to generate annual sales of over €5 billion. BASF said in October that it was looking to release this part of its operation, which employs 1460 staff and is expected to generate €2.5 billion in sales in 2010. But the plan had been mooted as far back as 2007. Ineos employs 2,200 people for its styrenic activities, which are expected to generate sales of €2 billion in 2010. In addition, Ineos has said that it intends to buy the other 50 per cent of its 50-50 styrenic joint venture, Ineos Nova, from Nova Chemicals. The associated activities will eventually become part of Styrolution. The companies did not, however, disclose financial details.

In other BASF news, the chemical giant has agreed to buy the styrene catalyst business of CRI Criterion, a US subsidiary of oil supermajor Shell. Financial details of the transaction are not being disclosed. CRI makes catalysts for the dehydrogenation of ethylbenzene to styrene. 

Private equity firm buys Royal

US company Royal Adhesives & Sealants says that it is to be bought by Arsenal Capital Partners, a private equity firm. Royal offers a range of thermosetting epoxy and urethane products. Investments in the Arsenal portfolio include agriculture and industrial chemical manufacturer Velsicol Chemical and Novolyte Technologies, a manufacturer of electrolyte materials for lithium ion battery and energy storage applications.

Thermo buys Lomb

Instrumentmaker Thermo Fisher Scientific has agreed to acquire Lomb Scientific, a supplier of chemicals and instruments in Australia and New Zealand. Lomb has about 100 employees and generated sales of AUD $34 million in 2009.

Andrew Turley 

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