A VISION REALIZED

Abstract

PETER ELVERDING, CHAIRMAN OF the Dutch chemical maker DSM, says his company's fiveyear program to get out of commodities and into specialties was guided by a few simple rules, including this one: Sell businesses before you buy them. The portfolio transformation program, called Vision 2005, is beginning to wrap up. And thanks to adherence to the rules, DSM seems to have pulled it off without any of the financial woes that plagued similar revamp efforts at other European chemical companies. Last month, DSM completed the purchase of Avecia's NeoResins coating resins business about $670 million, with Elverding calling it exactly the kind of acquisition DSM was looking for to finalize Vision 2005. Two weeks later, the company reported healthy 2004 results: Operating profit was up 66% over 2003, and organic sales volume increased 8%. DSM was a different company when it embarked on the restructuring in late 2000. The corporate descendant of a stateowned ...