News Release
Press Conference
March 10, 2009, Moscow
________________________
LANXESS AG
Contact: Ingo Drechsler
Corporate Communications
Corporate Media EMEA
51369 Leverkusen
Germany
Phone +49 214 30-43790
Fax +49 214 30-50691
[email protected]
Address by
Dr. Axel C. Heitmann
Chairman of the Board of Management
LANXESS AG
(Please check against delivery)
(2009-00003)
News Release
Chart 1: Title
Good morning, Ladies and Gentlemen.
I do not have to tell you that we are living in difficult times.
Here in Russia the sudden fall in oil prices, combined with the equally
sudden global economic meltdown, have put a damper on the extraordinary progress that this great country has enjoyed in recent years.
The news is certainly no better in Germany – in Europe – in America –
or anywhere else in our inter-connected world.
Our business, the chemical industry, has been very hard hit by slowed
production, anemic demand, tight credit – and all the other things that
industry everywhere is now feeling.
Though LANXESS is fortunate to have a well-diversified product portfolio, and a well-diversified customer base and though we are well
diversified geographically with 44 sites around the world – we are
certainly not immune to what is happening.
And yet – we are here today to officially announce that LANXESS, the
largest listed specialty chemicals company in Germany, is now making a
strong, new, long-term commitment to Russia
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I can assure you it feels very good to be bringing some positive news to
a press conference.
This commitment to Russia represents a major step in the long-term
growth strategy of our company.
Until recently we have done all of our business in Russia via sales
agents.
We are now establishing our own independent company here.
We are opening a LANXESS sales office in the magnificent Federation
Tower.
We are currently in negotiations with the local government of Nizhny
Novgorod with the objective of setting up a production facility there.
We are close to finalizing a cooperative scientific research agreement
with the Russian Academy of Science.
And we will be continuing to enlarge and strengthen our presence here
in many ways over the foreseeable future.
In other words, we are here to build a solid, long-term business partnership with Russia.
Now I suspect that some of you are wondering why are we making this
strong commitment to Russia now, in the face of a devastating economic crisis?
Well, I can give you two very good reasons.
One – Russia is right for LANXESS.
Two – LANXESS is right for Russia.
To me, that is what is really important. And I think this is the right time
to focus on what is really important.
Why is Russia right for LANXESS?
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Chart 2: Russia – right for LANXESS
Prime Minister Vladimir Putin gave a powerful answer to that question
in his speech at the World Economic Forum in Davos on January 28th.
He said that one of Russia’s top priorities was the “creation of a favorable business environment”. He said that Russia will “continue our
policy of openness to foreign investment”. And he said that Russia
is “going to actively develop the innovation sectors of the economy”.
For me, that seemed like an engraved invitation to LANXESS from
the Prime Minister of Russia to pursue our goal of a solid, long-term
commitment to Russia.
We accept the invitation – because we believe that Russia and the
CIS countries represent ideal markets for LANXESS.
Things may look somewhat dark today in our industry and in the
economies of our two countries, but we like to take the long view at
LANXESS. And we very much like what we see on the horizon.
From our perspective, we see growth in Russia outstripping that of
Western Europe in the years ahead.
Importantly, we see growth in the core industries that rely on our major
products – the automotive, tire, agricultural, chemical, construction and
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electronic industries – to be healthier here, over the long term, than in
Western Europe.
We know that Russia is right for LANXESS because we can clearly see
continuing and growing demand for the high-quality specialty chemical
products that we produce.
And I feel that there is a deeper reason why Russia is right for
LANXESS.
It is the spirit of innovation and creativity that is so much a part of the
Russian culture and the Russian experience. We know that Russia is a
country that warmly responds to that spirit.
After all, we are chemists – and modern chemistry really began in
Russia when Dmitri Mendeleev created the first periodic table of the
chemical elements in 1869.
Professor Mendeleev also founded the Russian Chemical Society,
introduced the metric system to Russia, and his oil research led to the
founding of the first Russian oil refinery.
So he is not only a hero to us chemists – he is a hero to the whole
world.
That is the kind of inventive and creative spirit that is right for an innovative chemical company like LANXESS. And Russia, with twelve Nobel
Prize winners in chemistry and physics, has always demonstrated that
wonderful spirit of discovery.
We know that in Russia we will find the talented, knowledgeable chemical and scientific minds that are so vital to our enterprise, and that here
we will find the technology and the research facilities that are critical to
our success. The planned cooperative arrangement with the Russian
Academy of Science is evidence of how important this is to us.
Another critical reason why Russia is right for LANXESS is that Russia
and the CIS are essential parts of our long-term growth strategy.
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Chart 3: LANXESS – a global specialty chemicals group
We are a young company, but we actually have a long history in Russia.
Our predecessor company, Bayer, has been doing business here for
over one hundred years.
Five years ago we were spun off from Bayer and became an independent
company.
Since then we have written quite a success story.
Today, LANXESS is a specialty chemicals group with 44 sites in 21
countries around the world with 15,000 employees and global sales on
the order of 7 billion Euros. We specialize in the production of polymers,
intermediate, and performance chemicals.
We have a very broad portfolio of products that primarily serve the
automotive, tire, construction, chemical, and agricultural industries.
One of the keys to our success has been our determination to build a
strong presence in the fast-growing BRIC countries – Russia, India,
China, and Brazil.
We are well positioned, with major facilities in Brazil, India, and China.
In fact those countries now account for about 15 percent of our total
sales.
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So now it is time to add the “R” to the fulfillment of our BRIC ambitions.
Ever since we became an independent company, one of our goals has
been to establish a strong presence in this market that we believe is so
right for us.
Russia represents, in fact, the next important step in our BRIC strategy
and is of the utmost importance to the long-term growth of our enterprise.
So you can see, there are many reasons why Russia is right for
LANXESS.
But now let me tell you some of the reasons why LANXESS is right for
Russia.
Chart 4: LANXESS – right for Russia
The government has clearly stated that it wants to expand the innovative sectors of Russia’s economy.
Well, LANXESS certainly fits in with that objective.
LANXESS is a highly innovative specialty chemicals company that
creates the products and the technology that can enable Russian
industry to make important breakthroughs in areas such as energy
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conservation, oil exploration, tire manufacturing, construction, auto and
truck manufacturing, agriculture and water treatment.
And in all these areas, LANXESS delivers quality, premium products,
thus fulfilling Russia’s goal of adding high-quality industries to its
economy.
In a few minutes, my colleagues Dr. Werner Breuers and Mr. Georges
Barbey will provide details about some of the quality, innovative products – and some of the special technologies – that we are bringing to
Russia.
But I want to tell you about one that I am especially proud of – one that
is very much a part of the history of our company, and the history of our
relationship with Russia. More importantly, it is one of the keys to our
future here in Russia.
One hundred years ago, a chemist in our predecessor company
succeeded in polymerizing the hydrocarbon isoprene, which forms the
basis of natural rubber.
That was truly a transformational moment in world history. For he had
discovered the process for creating synthetic rubber.
The tires on our cars, the shoes on our feet, and countless other useful
products and critical industrial processes all spring from that moment a
century ago.
It was a discovery that not only improved all of our lives and created
millions of jobs, but it also brought an end to the frantic pursuit of natural
rubber, which had caused massive destruction to the world’s rainforests.
We are now leveraging our heritage and our expertise in synthetic
rubber with a steady stream of innovations.
Today, LANXESS is the global leader in the production and technology
of high performance synthetic rubber.
We provide the rubber for today’s advanced, high-performance truck
and car tires – tires that are safer, last longer, and, because they have
less rolling resistance, save energy. That means lower CO2 emissions,
and thus less pollution.
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Importantly, we make possible the specialty, heavy-duty tires that
enable the powerful Kamaz trucks to keep working in the toughest arctic
conditions – and to win the grueling Dakar Rally a record eight times.
As we mark the hundredth anniversary of our invention of synthetic
rubber, we can celebrate a steady stream of technological breakthroughs in our rubber factories today.
And high-tech rubber is just one of hundreds of specialty chemical products that we bring to the Russian and CIS markets.
No, these might not be the prettiest of times to be entering new markets
and making investments.
But I hope I have shown why all of us at LANXESS believe that this is
the right time to do what is natural, and what is important for our longterm growth.
Chart 5: LANXESS and Russia – partnering for long-term success
I can assure you that we are extremely confident about our future here.
We are proud to be shaping our future together with the dynamic people
of Russia.
And we are thankful and deeply honored for the strong support and
cooperation that we have had from our friends and partners in the
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government, in the various institutions we work with, including the
Russian Academy of Science, and in the many industries we serve
here.
Now, Dr. Werner Breuers, member of the Board of Management of
LANXESS, will give you some details about our plans for Russia and the
CIS. He will tell you about some of the innovative products that we are
marketing here. He will be followed by Mr. Georges Barbey who is
heading up our Russian operations.
Together, they will provide still more reasons why we know that Russia
is right for LANXESS – and LANXESS is right for Russia.
Chart 6: Logo
Forward-Looking Statements
This news release contains forward-looking statements based on current assumptions and
forecasts made by LANXESS AG management. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future
results, financial situation, development or performance of the company and the estimates
given here. The company assumes no liability whatsoever to update these forward-looking
statements or to conform them to future events or developments.
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