According to the on-line publication Chemical Engineering, German chemical giant BASF has made an offer to buy Ciba Holdings AG, headquartered in Basel, Switzerland. In the public takeover, BASF has offered CHF 50.00 for each nominal share of Ciba stock. The agreed upon price represents a 32 % premium above the Sept. 12, 2008, closing price. The acquisition will help BASF strengthen its hold on specialty chemicals, particularly in the area of coatings.
University of Leicester, UK. John Bond, a reseacher at the University of Leicester and consultant to the Northamptonshire Police, suggests that criminals who consume fast foods leave fingerprints that are corrosive. Dr. Bond says that enhanced levels of salt in processed foods can lead to sweaty fingerprints that are more corrosive to metals.
Dr Bond said: “On the basis that processed foods tend to be high in salt as a preservative, the body needs to excrete excess salt which comes out as sweat through the pores in our fingers.
“So the sweaty fingerprint impression you leave when you touch a surface will be high in salt if you eat a lot of processed foods -the higher the salt, the better the corrosion of the metal.”
Dr. Bond went on to say that there was an “indirect link” to obesity and the chances of being caught in a crime. Bond says that corrosion due to fingerprints may be helpful in the tracking of terrorists whose bombs are fragmented from the explosion.
10 September, 2008. Anglo American has acquired a 12 % stake in the Australian mining firm Magma Metals Limited. Magma Metals had previously announced “spectacular” results August 11, 2008, in its exploratory drilling activities in the Current Lake intrusive complex north of Thunder Bay, Ontario, Canada.
Magma reports a 2.5 kilometer long strike zone with mineralization varying from 5.6 g/ton to 26.5 g/ton of Pt + Pd from one drill hole. The drilling revealed concentrations as high as several percent of Cu and Ni as well. Magma Metals reports that it has been undergoing a 24,000 meter drilling program to map the Thunder Bay claims.
Blundering through the patent literature I took a wrong turn and tripped over a patent that claims an interesting use of ammonia solutions of electrons. The patent, US 6080907, is assigned to Teledyne Commodore and teaches a method that uses ammonia as a fluid metal cutting medium for the safe destruction of bombs and the explosives inside. The inventor claims that ammonia is superior to water as a cutting fluid. Apparently Teledyne employs a few chemists because it dawned on someone that ammonia will also dissolve certain metals and provide a means of conveyance for a reducing agent to enter the bomb casing and reduce the nitro groups on the explosives. It is a clever idea. A new use for the Birch reduction.
I wonder if it is in operation?
There are many reasons not to start a business. It’s risky. It inevitably requires many long hours sweating all of the ten thousand details. Building a company from scratch requires wildly diverse skills that are not commonly possessed by a single person. And it usually requires more resources than a typical wage earner can easily muster.
A chemical entrepreneur with an eye on manufacturing faces some unique challenges that, say, a fledgling purveyor of roasted coffee beans could avoid. Most obvious it the issue of a physical plant. Not only must the chemist or engineer have a workable chemical process, but also have a highly specialized facility in which to do the processing. This requires suitably zoned land, local review boards, environmental permits, a local work force, process equipment, a minimum of raw material inventory, and buildings to contain it all.
Then the entrepreneur must provide an infrastructure of chillers, boilers, electrical distribution, liquid nitrogen for inert gas, an analytical facility, an R&D facility, quality control, as well as administration, sales, and technical staff. There must be a steady stream of cash flow to provide a steady payroll. Taxes must be estimated and paid in advance.
There are many sobering reasons not to go forward with a chemical business plan if one is risk averse or, shall we say, comfortable. Indeed, one of the common character traits of people who are analytically-minded is the tendancy to rattle off all of the reasons why something won’t work. We’ve all experienced this in meetings. A problem arises and meetings are called. After the problem is identified, much of the remaining time is spent in a recital of the additional problems that are expected. Soon, the problem mushrooms into a phantasm with imaginary components of awesome magnitude.
We’re all good at digging up reasons why something won’t work. And chemists suffer no lack of ability here.
But this is where the true entrepreneur stands out from the herd. One mark of a successful entrepreneur is the ability to ignore, or filter out, pessimistic predictions of an outcome. There is a spark within the some people that compels them to go forward. Sometimes it is a special insight. But just as likely the entrepreneur has an inner drive- some might unflatteringly call it “narcissism”- that moves them forward because they are certain of the outcome. It is not uncommon for an entrepreneur to consider him or herself the smartest person in the room.
In Part 3 we’ll look at examples of what kinds of businesses chemical entrepreneurs have started.
The modern mythos of 20th century American industry includes many stories of businesses being founded in a garage. As the stories go, a few plucky founders will construct a widget in their garage and, with prototype in hand, look for a way to get the product to customers. Famously, Apple computer and Hewlett Packard were founded in this manner.
What you don’t often hear about is the extent to which the founders might have performed a market study to ascertain the potential demand in the market. Possibly because the frequency of this ground work is near zero. Certainly the founders had some sense that like-minded folk would want copies of their products. In other words, if you build it, at least a few will come.
Similarly, one doesn’t hear so much about the rate of failure either. How many storage lockers are crammed with the remains of a failed business plan? Probably more than a few.
What every technological entrepreneur eventually has to come to grips with is this- who are the customers and how can you get the message of new capability to them? Seth Godin has some interesting ideas about this. Godin suggests that in todays information saturated market place, the critical customers are the innovators and the early adopters.
So here is the big question- Why don’t we hear more about chemists launching businesses out of a garage? Better yet, how might the chemical industry be different if more chemists did start a chemical business in this celebrated manner? Most might agree that the culture of entrepreurialism that Wozniak, Jobs, Packard, Hewlett, and Gates picked up and ran with dramatically accelerated the growth of the electronics industry. But fewer might agree on what clues these founders took as their cue to risk everything. How does a fledgeling chemical entrepreneur know if the idea, process, or material of interest is worthy of risking the family nest egg?
On the next posting, we’ll talk about some of the factors that a chemical entrepreneur might face in getting started.
Eurogiant BASF recently announced the launch of their new organozinc halide capability. BASF is offering a portfolio of organozinc halide reagents on the strength of a licensing agreement with Rieke Metals of Lincoln, Nebraska. The value proposition that BASF is pushing is the compatibility of organozinc species with functional groups that are normally incompatible with organolithium or organomagnesium reagents. Likewise, the zinc reagents will undergo a variety of coupling and Michael-type reactions, though apparently with additives.
It is interesting to speculate as to the basis of the license. Does Rieke have a proprietary process to license? Is it based upon trade secrecy or a patent? Certainly Rieke Metals has considerable expertise with organozinc chemistry plus a grip on its trademarked Rieke ®Zinc.
A perusal of the patent literature comes up with only one patent application by Rieke Metals as the assignee. However, Prof Rieke has been patenting for the University of Nebraska and obtained fifteen patents as of this date. The most recent patent is US 5,964,919 issued Oct. 12, 1999. A number of them could contain the value that BASF would require to step into this venture.
Of interest is US patent 6,603,034 issued to “Consortium fr Elektrochemische Industrie GmbH” for “A process for preparing organozinc halides in a solvent, comprising reacting a reactive halogen compound with zinc in at least one carboxylic ester, to produce a solution.” Hmmm.
I’m a distant admirer of Rieke Metals. I respect how they have grown into their niche and have remained focused on the prize. I hope the venture goes well for all concerned.
August 25, 2008. The Department of the Interior along with the Department of Energy has announced that the Hanford B Reactor has been designated as a National Historic Landmark.
A pdf download details the history of area 100-B. In this document there is a figure that shows how new fuel elements were pushed in one side and how the spent elements came out the other side into a water basin with the aid of the local (and free) gravitational field.
This seems very clever. I fear that a modern solution would involve 10 years of studies and would result in a half billion dollar high tech solution. Contractors would lock on to the DOE tit and hang there for decades with service contracts and spec’d in consumables.
Th’ Gaussling just received this photo of his good friend Paul on the summit of Mt. Kilimanjaro. This is a real accomplishment and my hat is off to him. Paul is a tenured perfesser of chemistry and is accustomed to slogging up endless slopes in the rarified air. We overlap in our fascination with asymmetric lactam enolate alkylations and pyridazine chemistry.
Paul on Top of Africa
The world of commodity goods and services may seem static to outside observers, but behind the curtain there is almost always a seething churn of battles occuring between competitors and with vendors. In the high volume, low margin world of commodity polymer manufacture, the price of resin (or “plastic”) feedstocks is subject to the variability of the global hydrocarbon market. The market determines your price and your costs. The trick is to avoid getting squeezed when unit costs and prices converge.
In the resin film and injection molding business, the ability to raise prices is constrained by the complex relationship between the manufacturer of polymer resins and the buying side of the market. The relationship between thermoplastic polymer (i.e., PE, PP, PS) manufacturers and the end user is not always direct.
The actual manufacturers of thermoplastic polymers produce their resin product in the form of squat little beads. There are several reasons for this. Beads are what you get when you cut extruded spaghetti noodles from the output side of the polymer reactor. This cutting process happens in a stream of water to remove process heat. The water rapidly cools the resin and prevents the beads from agglomerating. It also provides a means of conveyance to move the beads elsewhere in the processing facility.
The beads are removed from the water and subsequently moved to silos by pneumatic conveyance. Beads have the happy property of flowability. You can pour beads into a properly designed hopper and they will flow by gravity into a rail car or an extruder.
There is an intermediary customer called the converter. The converter buys resin beads from a manufacturer or distributor and converts them into higher value forms. Converters make films and injection molded items from these resin beads. Converters practice a high art. Some of their products, like films, may be pure resin. But a great many other products in the injection molding arena are highly modified with additives that provide desired attributes in the molding process itself or in the finished good. Additives are the output of a highly specialized industry.
Because the polymer market is very competitive, it is difficult for any given producer or converter to simply raise their prices. One of the tricks of the trade is something called “down gauging”. It is simple to understand. To improve manufacturing economics, converters will make their films thinner (in resonse to marketers of films) so as to make more sq meters of film with the same material input. The reader may have noticed that over time, plastic bags or wrappers have gotten much thinner. This is the result of down gauging.
Converters have to face material limitations in their resin feedstocks. For films, melt strength is one of the key parameters in processability and a big selling point for manufacturers of resin feedstocks. When you make a blown polymer film, your are actually extruding molten resin through an annular die to form a cylindrical bubble. The bubble rapidly cools to form a continuous tube of film that is then rolled as is, or slit to form a continuous sheet. This is a very common technique for making commodity films. If the molten bubble is not strong enough to withstand the effects of gravity and processing forces, it will collapse and fail.
One of the improvements to come along beginning in the early 1990’s is the availability of metallocene polymers, specifically mPE. This technology provides for greater control over the molecular structure of the polymer and subsequently, greater control of the rheology of polymer melts. Improvements in melt strength can lead to greater processing controllability for the converter and more options in gauge.
If you want to understand the PE and PP industry, you have to understand the relationship between resin manufacturers and converters. While converters do not drive the boat exclusively, they do have a large input into which direction the boat is pointed.
Lamentations on Chemistry 