The announcement follows a comprehensive strategic planning review by the company’s global leadership team to better understand Ashland’s markets, customers and the opportunities for each business to create the most value for shareholders, customers and employees. It also represents the final step in Ashland’s more than decade-long transformation from an oil refiner and marketer to a specialty chemicals company, during which the company completed dozens of acquisitions and divestitures.
“Ashland is fortunate to have two strong, but distinctly different, business platforms with attractive growth opportunities and experienced leadership teams,” said William A. Wulfsohn, Ashland chairman and CEO. “We believe that separating into two industry-leading public companies – one focused on specialty chemicals and the other focused on high-performance lubricants – will generate significant value for shareholders by enabling each company to focus on its specific business and strategic priorities.
“For the new Ashland, that means becoming a ‘solutions destination’ for a wide range of consumer and industrial customers through the delivery of value-added technology and world-class operations,” Wulfsohn added. “For Valvoline, it means building the world’s leading engine and automotive maintenance business by providing hands-on expertise to customers around the world.”
The new Ashland will be a global leader in providing specialty chemical solutions to customers in a wide range of consumer and industrial markets. These markets are currently served by Ashland’s Chemicals Group, comprising Ashland Specialty Ingredients and Ashland Performance Materials. Key markets and applications include pharmaceutical, personal care, food and beverage, architectural coatings, adhesives, automotive, construction and energy. Together these businesses generated approximately $3.6 billion in sales for the 12 months ended June 30, 2015.
Wulfsohn will serve as chairman and CEO of the new Ashland following the separation, while Luis Fernandez-Moreno, currently SVP of Ashland and president of Ashland’s Chemicals Group, will be COO of the new company. Kevin Willis, currently SVP and CFO of Ashland, will serve in the same capacity in the new Ashland.
Valvoline will focus on building the world’s leading engine and automotive maintenance business by providing hands-on expertise to customers in each of its primary market channels: Do-It-Yourself (DIY); Installers; Valvoline Instant Oil ChangeSM; and International. The globally recognized brand, which soon will celebrate its 150th anniversary, generated sales of $2 billion for Ashland in the 12-month period ended June 30, 2015.
Valvoline currently ranks as the #2 quick-lube chain and #3 passenger car motor oil brand in the United States. The brand operates and franchises approximately 940 Valvoline Instant Oil ChangeSM service centers in the United States. As an independent publicly traded company, Valvoline will focus on growing its network of Valvoline Instant Oil Change stores, leveraging the Valvoline brand across multiple channels to capture new market share, and expanding its presence in Asia, Europe, Latin America and other international markets.
Wulfsohn will serve as non-executive chairman of Valvoline following the separation, and Sam Mitchell, currently SVP of Ashland and president of Valvoline, will serve as CEO.
Ashland will begin the process to separate its specialty chemicals and Valvoline businesses while it finalizes the transaction structure and obtains customary regulatory and other approvals. Ashland shareholders will own shares of both the new Ashland and Valvoline.