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Thursday, June 19, 2008

Release–Süd-Chemie and Ashland to combine global business activities in the metal casting industry

Süd-Chemie AG, Munich, and the US company Ashland Inc. headquartered in Covington, Kentucky, today signed a non-binding memorandum of understanding to form a new, global joint venture to serve foundries and the metal casting industry. When final agreements are reached, each parent company will hold a 50-percent share of the joint venture, which is planned to be headquartered in Venlo, The Netherlands.

Assets and employees would transfer to the new joint venture upon closing, anticipated by early calendar year 2009. The transaction is dependent upon the successful negotiation of definitive agreements, and closing will be dependent upon satisfactory completion of due diligence and a number of standard closing conditions, including regulatory review.

The new enterprise would combine three businesses: Ashland’s Casting Solutions business group, the foundry-related businesses of Süd-Chemie, and Ashland-Südchemie-Kernfest GmbH. Had it existed in 2007, this new company would have generated sales of almost €700 million or approximately US$ 1.1 billion with a total of more than 1.300 employees, making it a worldwide leading company in this area.

Having begun in 1970 with the formation of Ashland-Südchemie-Kernfest GmbH (ASK) in Hilden, a highly-successful joint venture operating in Europe, the existing relationship between Süd-Chemie and Ashland in the area of foundry chemicals would now be significantly expanded. The new organization would unite the foundry-related sales, marketing, technology and certain manufacturing operations of both parent companies with those of ASK.

Süd-Chemie and Ashland pursue a similar strategy aimed at providing solutions for the rising technological requirements of modern and worldwide expanding foundries and seeking international expansion, especially in developing countries. In combination, the complementary business positions will enjoy well-established channels to serve the European marketplace, the Americas and Asia.

The industrial concept is based primarily on exploiting high growth potential by combining the foundry and metal casting know-how offered by both enterprises.

“When you consider the rapid industrialization occurring within key markets like China, Eastern Europe, Brazil and India it is easy to recognize the strong growth opportunities that exist for the metal casting industry,” said James J. O’Brien, Ashland’s Chairman and Chief Executive Officer. “Combining these businesses should ultimately result in increased shareholder value and better opportunities for our customers and employees.”

Dr. Günter von Au, Managing Board Chairman of Süd-Chemie AG, said: "Global competition is forcing us to create location networks in all important markets. By forming this new, globally active company, we shall be in a better position to satisfy our customers´ wishes as these become increasingly more sophisticated and more closely aligned on an international scale. We are looking forward to an even closer co-operation between Ashland and Süd-Chemie in the future.”

Dr. Hans Jürgen Wernicke, Deputy Chairman of the Süd-Chemie Managing Board confirmed that, "Our European joint venture ASK forms a solid basis for the envisaged global co-operation of our companies in the foundry sector. We are confident that the amalgamation of our worldwide foundry activities will lead to a high-level service by combining our know-how, offering a broader product portfolio and enhanced system solutions.”

Enquiries to:

Süd-Chemie AG Ashland Inc.

Corporate Communications Public Relations

Patrick Salchow Ken Gordon

Tel. +49 (0) 89 5110-250 Tel. +1 614 790-1832

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