Cognis and Thai Olefins agree fatty alcohol ethoxylates joint venture

Cognis Thai Ltd. and Thai Olefins Public Company Ltd. today announced that they have agreed to enter into a 50:50 joint venture for the production and marketing of fatty alcohol ethoxylates. This joint venture will operate under the name of Thai Ethoxylate Company Ltd., and will primarily serve customers in the home and personal care industries.

A new facility will be built at Rayong, south-east of Bangkok, at a total cost of 20 million US dollars, and is expected to be operational by October 2006. The Rayong industrial estate is currently the seventh largest complex for chemical operations in the world, and is situated only three miles away from a deep sea port.

Fatty alcohol ethoxylates are used in the production of surfactants for cosmetic, detergent and cleaning applications. The two companies will both contribute expertise in the production of the ethylene oxide and fatty alcohol feedstocks to the joint venture, which will also benefit from Cognis’ experience of ethoxylation processes.

For Thai Olefins this joint venture marks an important step in forward integration of their activities. A benefit for Cognis will be the availability to purchase part of the production for its own captive use, mainly at Cognis plants in Thailand, China and Indonesia. Cognis’ Care Chemicals strategic business unit is one of the world’s leading suppliers of ingredients for the home and personal care and industrial cleaning product industries. By sourcing fatty alcohol ethoxylates from the joint venture, it will be able to improve the service it offers to customers in the Asia-Pacific region.

According to Richard Ridinger, Group Vice President of Cognis Care Chemicals, “The care chemicals market in the Asia-Pacific region is already growing fast, and we expect the rate of growth to accelerate still further in the future. The joint venture with Thai Olefins secures our access to ethoxylation capacities in the region and will help us to provide our customers with top-quality products.”

Thai Olefins is a public company registered in Thailand. The major shareholder is PTT Plc, a Thai oil and gas conglomerate. In 2003, the company generated annual sales of 360 million euros, focusing on olefin products including ethylene and propylene. The joint venture represents a significant step in Thai Olefins’ forward integration process.

Cognis is a worldwide supplier of innovative specialty chemicals and nutritional ingredients. As at September 30, 2004, the company employed about 8,100 people, and it operates production sites and service centers in 30 countries. Cognis has dedicated its activities to a high level of sustainability and delivers natural source raw materials and ingredients for food, nutrition and healthcare markets, and the cosmetics, detergents and cleaners industries. Additionally, Cognis provides solutions for a number of other industries, such as coatings and inks, lubricants, textiles and plastics, as well as agriculture and mining. Cognis is owned by private equity funds advised by Permira, GS Capital Partners, and Schroder Ventures Life Sciences. In 2003, Cognis recorded sales of 2.95 billion euros and an Adjusted EBITDA (earnings before interest, income taxes, depreciation, amortization and exceptional items) of 312 million euros.

Cautionary Statement
The statements we make in this release may include statements about our plans and future prospects for the company and the industry that are forward-looking statements. Our actual performance may differ materially from performance suggested by those statements. We urge you to review the cautionary statements in our financial statements for information on factors that could cause those differences.

Contact:
Susanne Sengel, Corporate Communications Manager
Phone: +49-211-7940-5431
e-Mail: susanne.sengel@cognis.com
Internet: www.cognis.com

Wulf Klüppelholz, Corporate Communications Manager
Cognis Deutschland GmbH & Co. KG
Phone: +49-211-7940-6679
e-Mail: wulf.klueppelholz@cognis.com
Internet: www.cognis.com