Albemarle Corporation (ALB) and ICL announced that they have inked a deal to form a joint venture for the production of ICL's FR-122P polymeric flame retardant and Albemarle's GreenCrest polymeric flame retardant. The transaction is subject to approvals and is expected to close in 2015.

The flame retardants are made in a way that they can replace hexabromocyclododecane (:HBCD), which has been the leading flame retardant used in expanded (EPS) and extruded (:XPS) polystyrene foam applications. However, it is now being phased out in the European Union (EU), Japan and other countries.

The joint venture will operate two plants owned by ICL. Of these plants, one that is in the Netherlands and presently operating has a capacity to make 2,400 metric tons of flame retardants annually, while the other 1,000-metric-ton plant in Israel is expected to come online in the fourth quarter of 2014. With the joint venture in place, further capacity will be added.

The combined expertise and know-how associated with bromine and bromine derivatives of Albemarle and ICL guarantees a reliable, high-quality alternative offering to HBCD. Albemarle brings its financial backing and experience of making GreenCrest products to the joint venture. Albemarle began commercial supply of its GreenCrest sustainable polymeric product in Apr 2014 from the Netherlands plant. ICL on the other hand will provide polymeric flame retardants that meet the highest regulatory demands.

The combined production of polymeric flame retardants by both the companies demonstrate that despite stringent regulatory standards, they are committed to offering environmentally-friendly fire safety products and solutions. The companies will continue to provide independent marketing, sales and technical service to their customers in Europe and across the globe.

Albemarle has a Zacks Rank #3 (Hold).

Other companies in the chemical space with favorable Zacks Rank include LyondellBasell Industries NV (LYB), Valhi Inc. (VHI) and Johnson Matthey plc. (JMPLY). All of these stocks hold a Zacks Rank #2 (Buy).

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