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SGL Group completes carve-out of its Performance Products business unit

With this step SGL Group takes account of the changed fundamentals in the market for graphite electrodes.

6th June 2016

Innovation in Textiles
 |  Wiesbaden

Protective, Transport/​Aerospace, Civil Engineering

“Today marks a milestone in our strategic realignment. We executed the legal carve-out of our Performance Products business unit within SGL Group much earlier than planned. In doing so, we have laid the foundations for more specific analyses of strategic options,” said Dr Jürgen Köhler, CEO of SGL Group.

Market conditions

With this step SGL Group takes account of the changed fundamentals in the market for graphite electrodes. The overcapacities in the steel industry have exposed it to substantial price erosion. By means of the legal carve-out, SGL Group says it has created the necessary prerequisites for participating in a potential market consolidation.

The company has also adjusted its business model and the capacities of PP to the changed market conditions. In total, SGL Group plans to achieve further cost savings of close to EUR 30 million per annum in the mid-term.

“In the current market environment, the only thing that counts is cost leadership. However, as graphite electrodes are indispensable for recycling steel scrap, the business unit has good prospects for the future. Our strong market position, modern factories in all key regions in the world and our realigned business model make the business unit Performance Products a very attractive asset,” added Dr Jürgen Köhler.

Strategic realignment

The cornerstone of the strategic realignment initiated by SGL Group last year is the focus on the two business units Composites – Fibers & Materials (CFM) and Graphite Materials & Systems (GMS), where the company plans to increase its combined sales by over 50% by the year 2020, to approximately EUR 1.1 billion.

The growth drivers are high-performance materials based on carbon and graphite, which are fuelling developments in the megatrends mobility, energy supply and digitization.

SGL Group

SGL Group is one of the leading manufacturers of carbon-based products and materials. It has a comprehensive portfolio ranging from carbon and graphite products to carbon fibres and composites.

SGL Group’s carbon-based materials are designed to combine several unique properties, such as very good electrical and thermal conductivity, heat and corrosion resistance, as well as high mechanical strength combined with low weight. Due to industrialization in the growth regions of Asia and Latin America and increased substitution of traditional with innovative materials, there is a growing demand for SGL Group’s high-performance materials and products, according to the manufacturer.

Products from SGL Group are used predominantly in the steel, aluminium, automotive and chemical industries, as well as in the semiconductor, solar and LED sectors and in lithium-ion batteries. Carbon- based materials and products are also being used increasingly in the wind power, aerospace and defense industries.

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