Norway’s Orkla sells silicon unit to Chinese firm for $2-bn

Norwegian industrial conglomerate Orkla ASA has agreed to sell its silicon unit Elkem to China National Bluestar Co Ltd (Bluestar) for $2 billion, in another sign of continuing Chinese appetite for high technology firms from the developed world.

Elkem is a world leader in environment-friendly production of metals and materials. Its main products are silicon, solar-grade silicon, special ferrosilicon alloys for foundries, carbon and microsilica. The company has production facilities spread over five continents.

The transaction comprises Elkem's four divisions: Elkem Silicon Materials, Elkem Foundry Products, Elkem Carbon and Elkem Solar. The agreement also includes a 1.5 terrawatt per year power contract Orkla signed last year, which will ensure long-term power supply for its smelters in Norway.

Elkem's power operations Elkem Energi AS, and its 85-per cent stake in AS Saudefaldne are not included in the transaction.

Bluestar is a leading Chinese manufacturer of chemicals and new materials. The $6-billion company is owned 80 per cent by China's state-owned giant ChemChina, with the remaining 20 per cent held by US private equity firm Blackstone Group.

Bluestar has made a number of significant acquisitions in recent years including France's Adisseo and Rhodia's Silcones, and Australia's leading manufacturer of plastics and rubber Qenos.