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Solvay: The 160-Year Chemical Empire That Split Itself in Two
I. Introduction & Episode Roadmap
Picture Brussels on a crisp December morning in 2023. Inside the ornate halls of the Solvay headquarters—a building that would soon be physically divided between two successor companies—shareholders gathered for an extraordinary general meeting that would end one of Europe's oldest corporate dynasties as they knew it. On one side of the room sat the descendants of Ernest Solvay, the visionary chemist who transformed industrial chemistry in 1863. On the other, institutional investors who had grown frustrated watching a 160-year-old company trade at a persistent discount to its sum-of-parts value.
The vote passed. Shareholders voted December 8 to split the group into separate companies. By December 11, the spin-off was completed, and Syensqo began trading on Euronext Brussels and Euronext Paris, with an opening price of €90 per share, resulting in a market capitalization of €9.5 billion. It was the third largest listing ever on Euronext Brussels.
This is a story of how a company that once dominated global industry—with annual sales of about $6 billion and 9,000 employees—chose to return to its roots. How did a Belgian startup founded by two brothers in their early twenties become the world's first true multinational corporation? Why did that same company, after accumulating plastics, pharmaceuticals, composites, and countless other businesses, decide that the future lay in radical simplicity?
The themes that emerge tell us something profound about industrial capitalism itself: the power of process innovation as an enduring moat, the rise and fall of conglomerate strategy, and the modern investor's demand for "pure play" focus. Solvay remains a global leader in Soda Solvay® anhydrous sodium carbonate production, using two different processes: the traditional Solvay ammonia process and the refining of natural Trona.
The company's trajectory offers a masterclass in corporate evolution. Before World War I, Solvay was the largest multinational company in the world. Combined, the top companies represent around 32.2% of the global capacity, of which Solvay SA alone occupies 11% market share, emerging as the market leader. Today's Solvay operates seven soda ash plants globally—a far cry from its peak empire, but perhaps a more focused and defensible business.
II. The Solvay Brothers & The Founding Process (1838–1865)
The Founder's Journey
In a modest stone house in Rebecq-Rognon, Belgium, a quarry master named Alexandre Solvay and his wife welcomed their son Ernest on April 16, 1838. The boy showed early promise in science and might have followed an academic path—had fate not intervened. Acute pleurisy, a painful inflammation of the lung lining, prevented Ernest from attending university. Instead, at age 21, he found himself working in his uncle's chemical factory, a circumstance that seemed like misfortune but would prove transformative.
The industrial world of the 1860s ran on soda ash—sodium carbonate. This humble white powder was essential for glassmaking, soap production, textile processing, and countless other applications. Without soda ash, the windows of Europe's grand cathedrals could not have been made, nor the soap that helped prevent disease, nor the chemicals that fueled the Industrial Revolution's expansion.
But the prevailing method of producing soda ash—the Leblanc process developed in the late 18th century—was an environmental catastrophe. It required sulfuric acid and produced large quantities of toxic hydrochloric acid gas and solid calcium sulfide waste that accumulated in massive heaps, poisoning the surrounding land. The Leblanc process was effective but dirty, a brute-force approach to chemistry that left scars on the landscape.
The Revolutionary Process
Ernest Solvay possessed something that would prove far more valuable than a university degree: an obsessive attention to industrial process. Working in his uncle's gas works, he became intimately familiar with the practical challenges of chemical manufacturing. And he saw something others had missed.
The ammonia-soda reaction was not unknown to chemists. The theoretical pathway for converting brine and limestone into soda ash using ammonia and carbon dioxide had been described in academic literature. But theory and industrial practice are separated by a vast chasm. Every attempt to commercialize the process had failed. The reactions were difficult to control at scale, the equipment corroded quickly, and the economics simply didn't work.
In 1861, just before his 23rd birthday, Ernest Solvay filed his first patent describing a process to produce soda ash using salt, ammonia, and carbonic acid. The patent was promptly voided—chemists had long known the theoretical reaction. Devastated but undeterred, Ernest realized his insight wasn't the chemistry itself but the engineering of the process.
In 1863, with the help of lawyer Eudore Pirmez, he filed a second patent. This time, rather than claiming the chemical principle, he described "the succession of equipment and operations"—the precise industrial process that made commercial production viable. It was a crucial distinction that would hold up against legal challenges and competitors for decades.
Company Formation
Ernest needed capital to build a factory, and he found it in his younger brother Alfred. In 1863, when Ernest was 25 and Alfred just 23, the brothers founded Solvay et Cie. For their first industrial plant, they chose Couillet, situated in the heart of Charleroi's glass-making industrial district—an ideal location to produce soda ash for the customers who needed it most.
The early years were challenging. The Solvay process required continuous refinement. Equipment that worked in small batches often failed at industrial scale. Chemical reactions that proceeded smoothly in the laboratory became uncontrollable when scaled up a thousandfold. But Ernest's genius lay precisely in solving these practical problems. He understood that success would come not from a single breakthrough but from relentless optimization—improving yields by fractions of a percent, extending equipment life by weeks, reducing energy consumption by small but meaningful margins.
What the Solvay brothers had created was not merely a better way to make soda ash. They had developed an entirely new model for industrial chemistry—one where deep process knowledge became the ultimate competitive advantage. This insight would define the company for the next 160 years.
III. Building the World's First Multinational (1865–1914)
Rapid Global Expansion
By the early 1870s, the Solvay process had proven itself superior to Leblanc's method in every dimension that mattered. It required less fuel, produced higher purity product, and—crucially—eliminated the toxic waste that plagued Leblanc plants. Ernest Solvay moved quickly to exploit this advantage.
Rather than license his technology broadly, Solvay pursued a strategy of controlled expansion through wholly-owned plants and carefully selected partnerships. In the 1870s, the company established facilities in France at Dombasle near Nancy and at Tavaux in Franche-Comté, followed by plants in Germany, Russia, and the United States. The company was one of the earliest to go multinational, taking advantage of the extraordinary expansion of the world economy in the last quarter of the 19th century. By the 1880s, it had plants both wholly owned and through partnerships extending from Michigan to the Urals.
The American Frontier
The American expansion illustrates Solvay's methodical approach to growth. In 1881, the company pioneered the heavy chemical industry in the United States by establishing a plant in Syracuse, New York—the first in the country to manufacture soda ash using the ammonia-soda process. The plant was so successful that the surrounding town eventually took the Solvay name.
Syracuse was strategically selected. It offered access to salt deposits in central New York, coal from Pennsylvania, and limestone from nearby quarries—all the raw materials needed for the Solvay process. The location also provided water transportation via the Erie Canal system and proximity to the growing glass and detergent industries of the American Northeast.
The Russian Adventure
No story better illustrates Solvay's global ambitions than its Russian venture. In 1881, the company concluded a partnership with Russian industrialist Ivan Lubimoff. Two years later, a plant was erected in Berezniki, near the Ural Mountains—so remote that it took more than a week by sleigh and boat through the harsh winter climate to reach Moscow.
Why would a Belgian company build a factory in one of the most remote corners of the Russian Empire? Because that's where the customers were. Russia's vast distances and harsh climate made transportation costs prohibitive. By building near the Urals, Solvay could serve the emerging Russian glass and chemical industries without the expense of shipping products thousands of miles.
This willingness to go where competitors wouldn't—to build plants in challenging locations, to invest in logistics infrastructure, to take a multi-decade view of market development—became a Solvay hallmark.
Market Dominance
The results were extraordinary. In 1873, soda ash produced by Solvay won the prize at the Vienna International Exposition, earning global recognition for the ammonia-soda method. By 1900, 95% of the world's soda ash used the Solvay process. The Leblanc method, once dominant, had been rendered obsolete within a generation.
Before World War I, Solvay was the largest multinational company in the world. The scale of this achievement is difficult to overstate. This was an era before commercial aviation, before modern telecommunications, before sophisticated financial markets for managing currency risk. Yet Solvay operated a global network of manufacturing plants, each adapted to local conditions but all benefiting from the company's accumulated process knowledge.
The key to Solvay's dominance was not just having a better process—it was continuously improving that process while preventing competitors from catching up. Ernest Solvay understood that today's competitive advantage becomes tomorrow's baseline. He invested relentlessly in research and development, in training technicians, in documenting and sharing best practices across the growing network of plants.
IV. The Philanthropist-Industrialist & The Solvay Conferences (1894–1922)
Beyond Business: A Unique Cultural Legacy
The exploitation of his patents brought Ernest Solvay considerable wealth. But unlike many industrial magnates of his era, Solvay was consumed by questions that extended far beyond business. What was the nature of matter? How did societies evolve? What role should industry play in human progress?
These weren't idle curiosities. In 1894, Solvay established the Institut des Sciences Sociales (Institute for Sociology) at the Free University of Brussels. In 1903, he founded the Solvay Business School, which remains part of the university today. He created international institutes for physics and chemistry, endowing them with resources that would attract the finest scientific minds of the age.
Solvay gained a reputation as an enlightened employer, establishing medical and social programs for workers at a time when such considerations were rare. He believed that industrial progress and human welfare could be aligned—that the same systematic thinking that improved chemical processes could improve society itself.
The Historic Solvay Conferences
In 1911, Ernest Solvay did something unprecedented. He invited the world's leading physicists to Brussels for a week of intensive discussion about "the theory of radiation and quanta." The first Solvay Conference brought together minds that would reshape our understanding of the universe: Max Planck, Ernest Rutherford, Marie Curie, Henri Poincaré, and—then only 32 years old—Albert Einstein.
A famous photograph from that gathering shows Curie, the only woman present, seated among the giants of physics. Planck, whose quantum hypothesis would revolutionize physics, leans forward intently. Einstein, not yet the iconic figure he would become, appears contemplative in the back row.
A later conference would include Niels Bohr, Werner Heisenberg, Max Born, and Erwin Schrödinger—the architects of quantum mechanics. The 1927 Solvay Conference became legendary for the debates between Einstein and Bohr about the interpretation of quantum theory, discussions that continue to influence physics today.
His interest in matters such as the nature of the universe led to his initiation of the Solvay conferences on physics, which drew the greatest minds of the time. But why would an industrialist with no formal scientific training organize the most important physics conferences of the early 20th century?
The answer reveals Ernest Solvay's unique character. He believed that fundamental research and practical application were inseparable. The same curiosity that drove him to perfect industrial chemistry drove him to understand the deepest laws of nature. And he understood that Belgium—small, neutral, multilingual—could serve as a convening place for scientists from countries that would soon be at war.
The Enlightened Employer
Ernest Solvay died in 1922, at age 84. He had lived long enough to see his company become the world's dominant producer of soda ash, his conferences reshape physics, and his philanthropic institutions train generations of scientists and business leaders. But the world he knew was ending.
V. World Wars, Losses & Reinvention (1914–1967)
WWI Aftermath
The company's first major setback came at the end of World War I, when its Russian plants were lost in the aftermath of the revolution. The Berezniki plant that had taken more than a week to reach by sleigh—that monument to Solvay's global ambitions—was nationalized by the Bolsheviks. Decades of investment, accumulated expertise, and carefully cultivated customer relationships vanished overnight.
Shortly thereafter, in 1922, Ernest Solvay died. The company he built would continue under family leadership, but it would never again have the singular vision of its founder.
WWII and Reconstruction
World War II again changed the complexion of the company. Many of its important factories were damaged during the conflict. In addition, several of its plants were lost to the Soviet-dominated Eastern European countries—a second wave of expropriations that echoed the Russian Revolution's impact.
While rebuilding its facilities, Solvay did not neglect to make new developments, holding to its policy of careful diversification. The post-war period required the company to reinvent itself. The global soda ash market was changing. New competitors had emerged, and some countries had developed their own chemical industries during the war years, reducing their dependence on imports.
The Plastics Pivot
The company's most important strategic decision of the mid-20th century came in 1949, when it first produced polyvinyl chloride (PVC) at its plant in Jemeppe, Belgium. This move into plastics would prove to be one of the company's most important decisions, opening up a new and very profitable field that did not diverge significantly from the company's basic product lines.
The connection between soda ash and plastics wasn't obvious, but it was real. PVC production required chlorine, which was generated alongside caustic soda in the chlor-alkali process. And chlor-alkali was closely related to Solvay's core expertise in industrial chemistry. The company was leveraging its process knowledge into adjacent markets.
In the 1950s and 1960s, Solvay continued to grow, building and maintaining its position as a prominent manufacturer of bulk chemicals. The company also expanded the range of plastics it produced by beginning production of high-density polyethylene in 1959. Each expansion built on existing capabilities while opening new markets.
Going Public
Although Solvay was not incorporated as a public company until 1967, its roots went back to the 1860s. Under the guidance of four generations of Solvays, the firm became one of the largest in Belgium, combining chemical innovation with social projects and cultural programs.
The 1967 public offering marked a new chapter. For over a century, Solvay had operated as a family-controlled enterprise. Now it would answer to public shareholders, face quarterly earnings pressure, and compete for capital in international markets.
Family Ownership Structure
The founding family did not abandon the company they had built. Solvac is a Belgian holding founded in 1983, which groups the investments of the descendants of Ernest Solvay in Solvay of which it is the largest single shareholder with 30% of its shares. Solvay's major shareholder is Solvac SA, which holds more than 30% of Solvay's share capital.
This structure—a publicly traded operating company with a concentrated family ownership block—would shape Solvay's culture for decades. The Solvay family provided long-term perspective and stability, but they were no longer involved in direct management. The family stake consists exclusively of more than 30% in the capital of Solvay SA, and the shares are exclusively nominative. They may be held freely by individuals or, with the approval of the Board of Directors, by legal entities.
VI. The Conglomerate Era & Diversification (1967–2008)
Portfolio Expansion
The late 20th century was the era of the industrial conglomerate. Companies like General Electric, ITT, and Hanson demonstrated that skilled managers could run businesses across multiple industries, extracting synergies and allocating capital more efficiently than dispersed shareholders.
Solvay embraced this model. In the late 20th century, the company diversified its product offerings to include specialty polymers, agrochemicals, and advanced materials. The company acquired the European PVC business of BASF and swapped its small polypropylene business for BP's specialty polymers operations. The two companies also formed HDPE joint ventures in North America and Europe.
The biggest deal of this era came when Solvay bought Ausimont S.p.A., a EUR 600 million fluorinated chemicals and polymers business—its largest acquisition ever at that time. Each transaction added capabilities, customers, and complexity.
Perhaps most significantly, Solvay built a substantial pharmaceuticals business. The logic seemed compelling: both chemicals and pharmaceuticals required deep scientific expertise, regulatory management, and capital-intensive manufacturing. Surely a company skilled at making molecules could succeed in both arenas.
The growing complexity also brought changes to leadership. Aloïs Michielsen became the first person from outside the founding Solvay family to serve as chief executive—a milestone that signaled both the professionalization of management and the family's gradual step back from operational control.
By the early 2000s, Solvay had become exactly what management consultants recommended: a diversified industrial company with positions across chemicals, plastics, and pharmaceuticals. But the market wasn't rewarding this diversification. The stock traded at a persistent discount to the sum-of-parts value, suggesting investors would prefer to own the pieces separately.
VII. Inflection Point #1: The Pharma Exit (2009)
The Strategic Decision
In 2009, Solvay announced a decision that surprised many observers: the company was selling its pharmaceutical business to Abbott Laboratories for $7.6 billion. After decades of building a diversified portfolio, Solvay was choosing focus.
Calling the move the best option to secure growth for both its pharmaceutical and nonpharmaceutical sides, Brussels-based Solvay would refocus its efforts on chemicals and plastics. In deciding to shed its drug operations, Solvay was following the lead of several other once-diversified companies, including AkzoNobel, Altana, and BASF.
The Logic Behind Divestiture
The pharmaceutical industry had changed dramatically since Solvay first entered it. Research costs had skyrocketed, regulatory hurdles had multiplied, and scale had become increasingly important for sales and marketing. By tying up financial resources in pharmaceuticals, hybrid companies limited their ability to increase size and scale in chemicals. Meanwhile, their drug operations typically suffered from a lack of critical mass in R&D and sales compared with stand-alone competitors.
Recent consolidation in the pharma industry may have prompted Solvay's management to ask whether its own pharma operations could remain competitive against much larger companies. Dividing operations would not be an original move: European industry presents several recent examples of other conglomerates splitting their chemicals and pharmaceuticals units into separate businesses. As the smallest of the three units in terms of revenue, selling off pharmaceuticals seemed the obvious choice.
The market reaction was unambiguous: investors praised this plan, sending Solvay's stock up by 36% since the announcement. The conglomerate discount that had weighed on Solvay's valuation began to disappear as investors saw a more focused company emerging.
The Abbott Deal
Abbott completed its EUR 4.5 billion ($6.2 billion) acquisition of Belgium-based Solvay Pharmaceuticals, providing Abbott with a large and complementary portfolio of pharmaceutical products and expanding Abbott's presence in key global emerging markets.
For Solvay, the transaction provided something equally valuable: a war chest for reinvention. The proceeds from the Abbott deal would fund the next phase of the company's evolution—a return to chemistry, but a very different kind of chemistry than Ernest Solvay had practiced 150 years earlier.
VIII. Inflection Point #2: The Rhodia Acquisition (2011)
The Transformative Deal
With billions in cash from the pharmaceutical divestiture, Solvay's leadership faced a critical question: what kind of chemical company did they want to become? The answer came in 2011 with the friendly takeover of French chemical company Rhodia.
Led by its CEO Christian Jourquin, in 2009 Solvay sold its pharmaceutical activities to Abbott and reinvested the proceeds to acquire Rhodia. The deal announced in 2011 valued Rhodia's equity at EUR 3.4 billion and the enterprise value at EUR 6.6 billion. The offer price of EUR 31.60 per share represented a premium of 50% compared to Rhodia's closing price on April 1, 2011—a rich valuation that signaled Solvay's strategic commitment.
Strategic Rationale
Rhodia brought strengths in the consumer goods and automotive markets that Solvay lacked. The combined company would realize 90% of its combined sales of EUR 12 billion in businesses where it was already among the top three worldwide. Solvay was already a leader in high-performance specialty polymers, in soda ash and hydrogen peroxide, while Rhodia held leadership positions in specialty materials (silica, rare earths), products for consumer markets (surfactants, natural polymers, acetate tow) and engineering plastics based on polyamide 6.6.
The company, flush with cash, then bought Rhodia in 2011 for $4.8 billion, and this was arguably Solvay's first foray into the specialty chemicals business.
Leadership Succession
To facilitate a smooth and rapid integration, Jean-Pierre Clamadieu, Chairman and CEO of Rhodia, joined Solvay's Executive Committee in the role of Deputy CEO once the offer closed. Jean-Pierre Clamadieu was also intended to succeed Solvay's current CEO Christian Jourquin upon his retirement.
In 2012, Jean-Pierre Clamadieu, Rhodia's CEO, succeeded Christian Jourquin. It was an unusual arrangement—the acquirer's CEO yielding to the target's leader—but it signaled that Solvay valued Rhodia's management approach and wanted to retain its expertise.
The Legacy Liabilities
Rhodia wasn't a pristine asset. At the time Rhodia was heavily into consumer chemicals, advanced materials, and polyimides, but it had legacy issues of soil pollution from when it was RhĂ´ne-Poulenc. Rhodia also violated the Clean Air Act in 2007 and settled with the EPA to pay a $2 million penalty and spend $50 million on air pollution controls.
These environmental liabilities would follow Solvay for years, complicating the company's sustainability messaging and requiring ongoing remediation investments. It was a reminder that chemical acquisitions often come with hidden costs—contaminated sites, pending litigation, and regulatory obligations that can take decades to resolve.
IX. Inflection Point #3: The Cytec Acquisition (2015)
The Biggest Deal Ever
If Rhodia moved Solvay into specialty chemicals, the 2015 Cytec acquisition positioned the company at the cutting edge of advanced materials. The acquisition of the American company Cytec was the largest ever, necessitating the first capital increase since the transformation of Solvay into a public company in 1967.
Making a push into advanced composites for the aerospace and automotive industries, Solvay agreed to acquire New Jersey-based Cytec Industries for $5.5 billion. Solvay paid $75.25 per share, a premium of 28.9% over Cytec's closing price. Cytec had about $2 billion in annual sales, two-thirds of which came from carbon fiber composite materials used by the aerospace and automotive industries.
The Composites Play
Cytec previously was the chemical division of a widely diversified group called American Cyanamid, founded in 1907. It was spun off as an independent company in 1993 and specialized in composite technologies and mining chemicals. Thanks to this deal, Solvay further positioned itself as a leader in lightweighting materials for large customers in the aerospace and automotive industries.
The strategic logic was compelling. As airlines demanded more fuel-efficient aircraft and regulators pushed for lower automotive emissions, lightweight composite materials became increasingly valuable. Boeing's 787 Dreamliner, for instance, was composed of approximately 50% composite materials by weight—up from just 1% in earlier generations. Solvay wanted to be the supplier of choice for this secular trend.
The Solar Impulse Connection
Solvay's partnership with Solar Impulse illustrated the company's ambitions. Solvay was a main partner of Solar Impulse and contributed research and development resources to their solar-powered airplane project. That aircraft conducted its first test flight on December 3, 2009. In 2015–2016, Solar Impulse 2 flew around the world, the first such journey by a solar-powered aircraft.
The partnership was part marketing, part genuine R&D. By working with Solar Impulse, Solvay engineers pushed the boundaries of what lightweight materials could achieve—experience that would translate to commercial applications in aerospace and automotive.
Synergies and Integration
Solvay successfully completed the acquisition and immediately began integrating Cytec's businesses to deliver cost synergies and capture significant business opportunities in advanced lightweighting materials for the aerospace and automotive industries and in specialty chemicals for mining. Cytec represented a decisive milestone in Solvay's transformation and opened up new horizons for growth and innovation. Solvay became a leading provider of lightweighting materials for the aerospace industry.
X. The G.R.O.W. Strategy & Ilham Kadri Era (2019–2022)
New Leadership
Ilham Kadri (born February 14, 1969) is a Moroccan business executive. Between 2019 and 2023, she was the CEO of Solvay, a Belgian chemical company. In March 2019, Ilham Kadri became CEO of Solvay, where she had previously been an intern in Tavaux, France, in 1989. Her appointment was announced in October 2018.
Kadri's journey to the Solvay CEO role was remarkable. Kadri was born and grew up in Casablanca, Morocco. She studied engineering at ECPM Strasbourg (formerly École des Hauts Polymères de Strasbourg), majoring in polymer physics and chemistry. Kadri obtained her PhD in macromolecular physical chemistry in 1997.
Kadri started her career as a Development and Technical Service Manager at Royal Dutch Shell in Belgium, where she was part of a team that invented a synthetic bottle stopper made from a foamed thermoplastic elastomer. She then joined LyondellBasell in France, where she worked in Sales and Global Key Account Management.
While at Dow, Kadri built water purification plants in the United Arab Emirates, oversaw expansions in Kenya, Ghana and Nigeria, and developed water projects in Kuwait, Morocco, Oman, Israel, Kazakhstan and Azerbaijan. She also launched the construction of Saudi Arabia's first reverse osmosis (RO) membrane manufacturing plant.
From 2013, Kadri became Senior Vice President and Officer for Sealed Air Corporation, and took on the role of President of Diversey Care. On arriving at Diversey Care, Kadri was tasked with the turnaround of falling sales and profits, which saw her lead reforms of the service division. She was also a key figure in Diversey Care focusing on a strategy of technological innovation.
At the briefing, she said she's proud to be only the fourth non–family member to lead Solvay in its 156-year history. "It's good to see people of different backgrounds supporting the company to be better," she said.
Transformation Program
Under her first year as CEO, Solvay launched its new strategy G.R.O.W., the Solvay One Planet sustainability plan, and its corporate purpose. The G.R.O.W. acronym represented Growth, Returns, Outstanding, and Win—a framework for prioritizing where Solvay would compete and how it would measure success.
Prior to the separation, Kadri successfully led the turnaround of Solvay since 2019, delivering double-digit EBITDA growth and 18 consecutive quarters of positive free cash flow, deleveraging the balance sheet and promoting superior people engagement. During her tenure she established the company's Purpose; drove the Group's G.R.O.W. strategy and fulfilled its economic objectives two years ahead of schedule. She led the holistic Solvay One Planet sustainability program, which outperformed the CO2 reduction objectives set by the Paris Agreement.
At the same time that Kadri wrestles with near-term issues, she started to roll out a company-wide restructuring designed to improve Solvay's underlying financial performance. At the heart of her approach is a reallocation of resources away from poorly performing businesses to more profitable ones.
Kadri's arrival coincided with challenging times. She was expecting that plant shutdowns in China during the first quarter as a result of the SARS-CoV-2 outbreak would reduce pretax profits by about $27 million. The firm also faced a $33 million–$44 million cut in pretax profits because of reduced sales of carbon fiber composites and other materials for the 737 Max. Boeing was expected to reduce production of the plane from almost 600 in 2019 to 200 in 2020.
In 2020, Solvay, together with the King Baudouin Foundation, created the Solvay Solidarity Fund for employees and their families impacted by the Covid-19 crisis.
Kadri was ranked 21st in Fortune magazine's Most Powerful Women in Business–International list in 2019. In 2017, she won Golden award for Woman of the Year (Industry), and Golden award for Women Helping Women (Business) awards at the 14th annual Stevie Awards for Women in Business. In July 2021, she was decorated with the Légion d'honneur.
XI. The Power of 2: Splitting into Solvay and Syensqo (2022–2023)
The Split Decision
By 2022, despite all the progress under Kadri's leadership, Solvay's board confronted an uncomfortable reality: the stock market still wasn't fully valuing what the company had built. The conglomerate structure that had seemed like a strength—diversification across commodities and specialties—was now viewed as a weakness. Investors preferred "pure play" companies with focused strategies and clear investment theses.
Along came a management shake up, a new strategy, sustainability programs, up to €2 billion in asset sales, and Solvay's first employee stock ownership plan. Then, 12 months ago, Kadri and the board proposed the split. Even Solvay's new headquarters in Brussels that it's moving into later this year will be sawn in half. "We looked at all the options, clinically: should we stay the same, or continue selling businesses or do M&A," Kadri said.
Center stage was CEO Ilham Kadri. She took over when the board and founding Solvay family, with a 30% stake, were looking for someone to address a stubbornly low stock-market valuation. Something as dramatic as a breakup wasn't on the cards, but the family got on board. Solvay's place in the history books is cemented, but its share-price performance has been less solid. Yet the fashion for conglomerates with both commodity- and specialty-chemical businesses has waned, and the value of Solvay's exploits in high-performance materials to lightweight aircraft and EVs were largely overlooked by the stock market.
The Separation Structure
Solvay spun off its specialties segment which will now be called Syensqo. Its commodities business, referred to as EssentialCo since the split was first announced, remained as Solvay.
Solvay comprises the mono-technology businesses including soda ash, peroxides, silica, solvents and rare earths. Syensqo covers specialty polymers, composites, surfactants, aroma, technology solutions, and oil and gas, as well as the four growth platforms in batteries, green hydrogen, thermoplastic composites, and sustainable consumer goods.
Syensqo began trading on the Euronext Brussels and Euronext Paris stock markets December 11. With a market value of about $10 billion, the newly formed company has about $8.5 billion in annual sales and 13,000 employees. It makes products such as adhesives, fragrances, and specialty polymers. Syensqo is led by Ilham Kadri, Solvay's former CEO.
Kadri was instrumental in the split of the company into the traditional Solvay and Syensqo materials unit. Syensqo was immediately after the split made part of the Bel 20 index. In the new Syensqo spin-off, Kadri serves as Chief Executive Officer, as Chair of the Executive Leadership Team, and as member of the Board of Directors of Syensqo.
New Solvay Leadership
Solvay's new CEO is Philippe Kehren, former head of its soda ash business. Solvay now has annual sales of about $6 billion and 9,000 employees; its key product continues to be soda ash.
Philippe Kehren is Chief Executive Officer and member of the Board. Before becoming CEO, he was President and Head of Sustainability of the Soda Ash & Derivatives global business unit at Solvay. He is an industrial authority with a 30-year cross-functional experience acquired in multiple management roles. At the helm of the Soda Ash & Derivatives business since 2020, Mr. Kehren transformed the business, which has resulted in strong cash generation, margins and growth, reinforcing its global leadership while speeding up the Company's energy transition.
He accelerated the reinvention of the Solvay process through cutting-edge innovation to improve the competitiveness and sustainability of production. He joined Solvay in 2012 to lead business development in Energy Services, and later oversaw the successful turnaround of the European Soda Ash business.
Kehren joined Rhone Poulenc in 1996 as a process engineer, followed by roles including finance director of Solvay's former Polyamides business; director of a business unit leading clean energy production units in Europe, Asia and Latin America; and as director and vice president, Europe, for Solvay Energy Services. He obtained his Master of Science in Chemical Engineering in 1995 from the University of Wisconsin, Madison.
XII. The Essential Chemistry Company: Solvay Today (2024–2025)
Post-Split Performance
Despite a market environment that shows little signs of recovery, Solvay's position as an essential chemical player combined with its leadership positions in its core markets have enabled it to deliver a solid financial performance in 2024. Free Cash Flow amounted to €361 million in 2024, underpinned by the solid EBITDA performance and the working capital discipline, while Capex accelerated in Q4 2024. Underlying Net Debt remained stable at €1.5 billion, implying a leverage ratio of 1.5x.
This success is underpinned by continued year-on-year growth in volumes for businesses such as Bicarbonate and Peroxides, and significant cost savings achieved through ongoing transformation and digitalization efforts. They have also made significant strides in sustainability, by reaffirming commitment to carbon neutrality, launching the ambitious "For Generations" roadmap, and continuing to advance new energy transition projects to reduce environmental footprint.
As a world-leading company with €4.7 billion in net sales in 2024 and listings on Euronext Brussels and Paris (SOLB), its unwavering commitment drives the transition to a carbon-neutral future by 2050.
Operating Structure
Solvay's current portfolio is operated through five divisions: Soda Ash and Derivatives, Peroxides, Silica, Special Chem and Coatis. Solvay SA offers customer-proximate regional locations, large scale as well as competitive cost curve positioning due to the vertical integration in its main businesses. The company has a balanced global footprint with 6 major research centres as well as 44 industrial sites in 41 countries across the world.
Basic Chemicals (Soda Ash & Derivatives and Peroxides): these chemical intermediate businesses are focused on mature and resilient markets, such as consumer goods, healthcare, food, electronics and building & construction. Performance Chemicals (Silica, Coatis, Special Chem): these businesses offer a wider range of products that are subject to customization based on unique formulations and application expertise. They serve various markets like automotive, consumer goods and electronics.
2025 Outlook and Challenges
Solvay reported Q1 2025 net sales of €1.1 billion, representing a 6% organic decline compared to the same period last year. Despite this top-line pressure, the company managed to maintain its profitability with underlying EBITDA of €250 million, also down 6% organically but with a slightly improved margin of 22.3% compared to 22.1% in Q1 2024.
Solvay confirmed its outlook for 2025 but expects its underlying EBITDA to be in the lower half of the previously announced range of €1.0 billion to €1.1 billion. Free cash flow is projected at approximately €300 million, with capital expenditures limited to around €300 million.
Cost savings are expected to reach €200 million by year end (from €110 million at the end of 2024), offsetting both inflation and the temporary Corporate stranded costs expected in 2025 from the exit of the Transition Service Agreement with Syensqo.
XIII. The Global Soda Ash Market: Context and Competition
Market Overview
The global soda ash market size is likely to be valued at US$21.9 Billion in 2025 and is expected to reach US$29.4 Billion by 2032, growing at a CAGR of 4.3%. This is driven by strong demand from the glass manufacturing, detergents, and chemicals industries.
Glass manufacturing remains the largest end-use segment for soda ash, accounting for approximately 51% of market share in 2025. This includes flat glass for construction and automotive industries, container glass for beverages and food packaging, and specialty glass such as borosilicate and solar glass.
Synthetic soda ash continues to dominate the market with a market share of 57.6% in 2025, due to the widespread adoption of the Solvay process in Europe and Asia. Large-scale producers such as Solvay in Belgium and GHCL in India supply synthetic soda ash to industrial clusters where natural trona deposits are unavailable.
Natural soda ash is experiencing the fastest growth globally due to its lower carbon footprint, reduced energy requirements, and cost advantage per tonne. Key trona-producing regions include Wyoming (USA), Turkey, and parts of Africa, where investments in extraction and processing are increasing.
Solvay's Competitive Position
Combined, the top companies represent around 32.2% of the global capacity, of which Solvay SA alone occupies 11% market share, emerging as the market leader. The company operates seven soda ash plants globally.
Solvay is a global leader in Soda Solvay® sodium carbonate production, using two different processes: the traditional Solvay ammonia process and the refining of a primary source of sodium carbonate, natural Trona.
Solvay Soda Ash & Derivatives is a global business division of Solvay. As a world leading player in its markets, it provides a global, secured and sustainable supply of soda ash to its customers manufacturing glass for building, automotive, solar panels and packaging applications; as well as detergents and chemicals. It also develops solutions used to produce lithium carbonate for EV batteries and other solutions based on sodium bicarbonate for the health care, food, animal feed and flue gas cleaning markets. Solvay Soda Ash & Derivatives has nine major soda ash and bicarbonate plants—six located in Europe, two in the United States, and one in Asia.
Key Competitors
Ciner Group is a leading industrial conglomerate in Turkey and the world's largest producer of natural soda ash. The company has interests in various industries such as mining, energy, glass, chemicals, shipping, and tourism. Its flagship plant, Ciner Wyoming in Green River Basin, has been manufacturing top-quality, eco-friendly natural soda ash. The company has built a worldwide presence through planned alliances and acquisitions.
Sisecam is the top glass and chemicals manufacturer in Turkey and has strong presence in the soda ash market. The business operates as an integrated industrial group spanning the production of glass, chemicals, and mining. Sisecam has built a global network through strategic investments and acquisitions such as partnerships within the US soda ash market. The business focuses on technological innovation, sustainability, and environmental stewardship.
Tata Chemicals Limited is one of the top chemical and chemical product manufacturing companies operating via two verticals, basic chemistry products, and specialty products. The company provides various basic chemistry products to numerous leading brands.
XIV. Energy Transition & Sustainability Initiatives
The Green River Transformation
Solvay completed its coal phase-out at Green River in February 2024. "From today, we will no longer use coal at Green River. The decision to power this strategic, natural soda ash facility with natural gas enhances Solvay's long-term competitiveness and sustainability," said Philippe Kehren, Solvay CEO.
The Green River plant historically used coal as a primary energy source. Solvay's global sustainability goals include a commitment to phase out coal for energy production before 2030. By 2025, overall emissions from Green River will have decreased by 20% compared to 2021, despite a 25% increase in production.
In October 2024, Solvay announced the official inauguration of its regenerative thermal oxidation (RTO) process at its Green River, Wyoming plant, marking a key milestone in the Group's global efforts to reduce greenhouse gas emissions. This innovative emissions control technology, the first of its kind in the trona mining industry, enhances Solvay's long-term competitiveness. It will contribute to reducing GHG emissions at the Green River plant by up to 20% annually and support achieving a 4% reduction in emissions at Group level by 2025.
This development is part of a broader sustainable growth strategy at the Green River site. The expansion of soda ash production capacity by 600 kilotons is currently underway and expected to be completed by early 2025. Alongside the increase in production capacity, the site aims to achieve an annual 20% reduction in total GHG emissions by 2025. Additionally, global export capacity is planned at the Port of Vancouver USA by early 2026.
The e.Solvay Process Innovation
Solvay has invested €40 million over the past years to develop proprietary technology first patented in 2014. Solvay's researchers and engineers have invented e.Solvay, a new method to produce soda ash, achieving three revolutionary improvements in the process: emitting 50 percent less CO2; reducing water, brine and limestone consumption; and completely eliminating limestone residues.
The NEOM Partnership
Solvay is partnering with ENOWA, NEOM's energy and water company, to establish the world's first carbon-neutral soda ash production facility in NEOM, Saudi Arabia. Pending the results of an in-depth feasibility study and customary regulatory approvals, Solvay and ENOWA plan to begin operation of the groundbreaking plant by 2030. The state-of-the-art facility is poised to emerge as an industry-leading model for soda ash production on a global scale.
It will serve as a vital component in ENOWA's Water Sustainability Strategy and reflects NEOM's commitment to developing a zero-liquid discharge water management system. Strategically located off of the Red Sea coast to support access to markets across the Middle East, Africa and Southeast Asia, the renewable-powered plant will convert seawater brine into soda ash and integrate the e.Solvay process for sustainable and carbon-neutral soda ash production.
The partners aim to start 500,000 tons soda ash nameplate capacity by 2030 which would gradually increase up to 1.5 million tons by 2035, with the potential addition of sodium bicarbonate production. Earlier this year, the e.Solvay pilot production process began operations in Europe. Designed to evaluate the viability of a more sustainable and competitive soda ash production technology, the pilot has yielded positive results.
Global Energy Transition Progress
Solvay operates seven soda ash plants worldwide. Beyond Green River, coal is being phased out at two plants, located in France and Germany. By the end of 2024, Solvay's Rheinberg, Germany site became the first soda ash plant in the world to be powered primarily with renewable energy. The last two Solvay plants using coal for energy production, located in Spain and Bulgaria, have also begun their journey with partial introduction of biomass and gas.
Emphasizing sustainability, Solvay's roadmap underscores the Group's commitment to a fair transition and environmental responsibility, with a proactive aim to achieve carbon neutrality by 2050. In its transition to cleaner energy, Solvay is eliminating coal usage by 2030 wherever renewable alternatives exist, with a notable goal of achieving coal-free energy at 5 of its 7 soda ash plants by 2025. Beyond reducing its own emissions, Solvay is committed to a 20% reduction in emissions along the value chain by 2030.
XV. The Rare Earths Opportunity
European Strategic Autonomy
In April 2025, Solvay officially inaugurated its rare earths production line for permanent magnets at the La Rochelle facility, marking a significant milestone in the Group's commitment to meeting Europe's strategic goals. This expansion enables Solvay to start delivering rare earth materials for permanent magnets, reinforcing its position as a global leader in the rare earths market. The investment in France enhances an established facility, the biggest plant outside China capable of separating all rare earth materials.
Founded in 1948, Solvay's La Rochelle plant specializes in rare earth-based formulations and has recently expanded its capacity to lead European rare earths production. Located on a 40-hectare site in the Chef de Baie industrial zone by the seafront, the facility employs over 300 people. The plant now includes a production line for permanent magnets, essential for electric vehicle motors, renewable energy, advanced electronics, and defense applications.
Critical Raw Materials Act Alignment
This phase is the first step toward meeting the objective of satisfying 30% of European demand by 2030. The facility will source rare earths and recycled materials from a diverse range of suppliers and mining partners, as mandated by the Critical Raw Materials Act. Solvay is partnering with emerging mining and recycling players to accelerate the establishment of a robust, reliable, and sustainable supply chain.
The processing plant was a significant supplier decades ago, but output has dwindled as China has ramped up cheaper production. The country now accounts for around 90% of the world's processed rare earths, according to figures from the IEA.
Solvay said it has invested several million euros expanding the plant and will wait for interest from customers before committing about €100m ($113m) for a full-scale expansion. "The issue is not capacity. We can adapt to what is needed," An Nuyttens, president of Solvay's division that produces rare earths, told Reuters. "The car manufacturers, the wind turbine manufacturers, those are the stakeholders that will make this happen or not."
An Nuyttens, President of Solvay's Special Chem business, added, "While expanding the site's capacity, we are reinventing our process that leverages our unique know-how in rare earths separation to reduce CO2 emissions by 40% and halve water consumption by 2030."
XVI. Investment Analysis: Bull vs. Bear Case
Bull Case
Market Leadership & Process Innovation: Solvay's 160 years of continuous process improvement in soda ash production represent a formidable competitive advantage. The company holds approximately 11% global market share and operates some of the most cost-competitive assets in the world, including the Wyoming trona-based operations that benefit from natural mineral deposits rather than energy-intensive synthetic processes.
Essential Products with Stable Demand: Soda ash is foundational to multiple essential industries—glass for construction and automotive, detergents for hygiene, chemicals for countless applications. Unlike specialty chemicals that face substitution risk, soda ash has no practical alternatives at scale. This provides defensive characteristics during economic downturns.
Energy Transition as Competitive Moat: Solvay's aggressive coal phase-out and investment in sustainable production (e.Solvay process, renewable energy) position it to capture the growing premium for low-carbon materials. As European carbon pricing increases and customers demand sustainable supply chains, Solvay's investments in decarbonization become competitive advantages rather than mere costs.
Rare Earths Optionality: The La Rochelle facility positions Solvay to benefit from European efforts to reduce dependence on Chinese rare earth supplies. If geopolitical tensions escalate or customers increasingly demand non-Chinese sources, Solvay holds a valuable option that isn't reflected in current valuation.
Capital Discipline & Cash Generation: Post-split, Solvay has demonstrated strong free cash flow generation (€361 million in 2024) and maintains investment-grade credit ratings with 1.5x leverage. The simplified structure enables focused capital allocation rather than spreading resources across disparate businesses.
Bear Case
Commodity Business Dynamics: Despite market leadership, soda ash remains fundamentally a commodity business subject to cyclical pricing, capacity additions by competitors, and limited pricing power. Turkish producers (Sisecam, Ciner) have added significant natural soda ash capacity that could pressure European synthetic producers on cost.
Energy Cost Exposure: Synthetic soda ash production is energy-intensive. While Solvay is transitioning away from coal, it remains exposed to natural gas prices, particularly in Europe. The energy crisis of 2022 demonstrated how quickly margins can compress when energy costs spike.
China Market Risk: China accounts for the largest share of global soda ash consumption and production. Chinese producers operate at different cost structures and face different regulatory environments. Overcapacity in China could lead to export pressure that disrupts global pricing.
Environmental Liabilities: Legacy environmental issues from historical operations (including Rhodia-era contamination) require ongoing remediation spending and create litigation risk. These liabilities are difficult to quantify but represent a persistent drag on free cash flow and potential source of negative surprises.
Growth Constraints: As an essential chemicals company focused on mature markets, Solvay's organic growth potential is limited to underlying market demand (approximately 3-4% annually). Without acquisitions, the company may struggle to compound shareholder value at rates that satisfy growth-oriented investors.
Porter's Five Forces Analysis
Supplier Power (Low-Medium): Solvay sources commodity inputs (salt, limestone, natural gas) from competitive markets. The Green River trona operations provide integrated access to raw materials. However, energy costs can fluctuate significantly.
Buyer Power (Medium): Major glass manufacturers and detergent companies are concentrated and sophisticated buyers. However, switching costs exist (product qualification, logistics) and Solvay's global footprint provides security-of-supply value.
Threat of New Entrants (Low): Soda ash production requires significant capital investment, technical expertise, and access to raw materials or trona deposits. Regulatory requirements and environmental permitting create additional barriers. New synthetic capacity takes years to build and qualify.
Threat of Substitutes (Very Low): No practical alternatives exist for soda ash in glass manufacturing at commercial scale. This is perhaps Solvay's strongest competitive position.
Competitive Rivalry (Medium-High): The industry is consolidating (Sisecam's acquisition of Ciner's US operations) but remains competitive. Natural soda ash producers in Turkey and Wyoming compete on cost, while synthetic producers compete on proximity to customers and product specifications.
Hamilton Helmer's 7 Powers Framework
Scale Economies: Solvay benefits from scale in production, logistics, and R&D. Larger plants operate more efficiently, global logistics networks reduce per-unit shipping costs, and R&D investments (e.Solvay process) can be amortized across higher volumes.
Network Effects: Limited direct network effects, though Solvay's global customer relationships create value for multinational customers seeking single-source suppliers.
Counter-Positioning: The e.Solvay process and NEOM carbon-neutral project represent potential counter-positioning against competitors tied to traditional high-emission processes. If carbon pricing increases materially, incumbent competitors face difficult choices about stranded assets.
Switching Costs: Product qualification requirements in glass manufacturing create modest switching costs. Customers who have validated Solvay's soda ash specifications face time and cost to requalify alternative suppliers.
Branding: Limited direct branding power in B2B commodity chemicals, though "Solvay process" as an industry standard creates historical association.
Cornered Resource: Wyoming trona deposits represent a cornered resource—natural soda ash with significantly lower CO2 emissions than synthetic production. European rare earths processing capability (La Rochelle) may become increasingly valuable as geopolitical tensions affect Chinese supply.
Process Power: This is Solvay's strongest power. 160 years of continuous process improvement, accumulated know-how, proprietary innovations (e.Solvay), and operational excellence in running soda ash plants represent difficult-to-replicate capabilities.
XVII. Key Metrics & Investor Considerations
Critical KPIs to Monitor
1. EBITDA Margin: Solvay targets "top-quartile industry margins" as a key performance indicator. The Q1 2025 EBITDA margin of 22.3% demonstrates resilience despite volume pressures. Investors should track whether margins remain above 20% through economic cycles.
2. Free Cash Flow Conversion: The company's ability to convert EBITDA into free cash flow determines capacity for dividends, debt reduction, and capital investment. The 2024 FCF of €361 million against EBITDA represents strong conversion. Monitor for deterioration if working capital builds or capex exceeds guidance.
Valuation Context
At current market capitalization of approximately €3.4 billion and trailing revenue of ~€5 billion, Solvay trades at roughly 0.7x revenue and approximately 3.4x EBITDA based on 2025 guidance. Shareholders approved a gross dividend of €2.43 per share for the year 2024, representing an attractive yield at current prices.
The valuation reflects both the commodity-like nature of the business and investor uncertainty about cyclical conditions. If management delivers on cost-saving targets and sustainability investments create competitive differentiation, there may be multiple expansion potential. Conversely, if soda ash pricing weakens or environmental liabilities prove larger than expected, current valuations could compress further.
Regulatory & Legal Considerations
Investors should monitor environmental liability provisions carefully. Historical operations, including Rhodia-era sites, require ongoing remediation that creates uncertain future obligations. The company's transition away from coal, while strategically sensible, requires significant capital expenditure in the near term.
The company maintains a BBB- stable outlook from S&P, indicating investment-grade credit quality but with limited cushion. Material deterioration in operating performance or significant acquisition activity could pressure the rating.
XVIII. Conclusion: Essential Chemistry for Generations
On a winter morning in 1863, two brothers in their early twenties founded a company based on a revolutionary way to make a commodity chemical. One hundred sixty years later, that company has come full circle—spinning off its specialty businesses to focus, once again, on the essential chemistry that built its fortune.
The story of Solvay illuminates timeless principles of business strategy. Process innovation created and sustained competitive advantage across six generations. Diversification into pharmaceuticals and specialty chemicals seemed logical but ultimately destroyed value. The disciplined return to roots—"essential chemistry"—represents a bet that focus trumps scope in modern capital markets.
As Philippe Kehren observed: "When Ernest Solvay invented a radically new industrial process for the production of soda ash nearly 160 years ago, his technological breakthrough laid the foundation for our great company."
Today's Solvay faces challenges that Ernest Solvay could never have imagined—climate change requiring decarbonization of industrial processes, geopolitical tensions threatening supply chains, capital markets demanding quarterly performance. But it also possesses advantages that might have astonished the founder: proprietary process innovations (e.Solvay), global logistics networks, and partnerships (NEOM) that span continents.
The company that invented the modern chemical industry has reinvented itself once more. Whether this return to essentials creates enduring value—or proves to be one more chapter in an endless cycle of diversification and refocusing—remains to be written. But 160 years of continuous operation suggests that the Solvay name, and the process it pioneered, will endure for generations to come.
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