The company said that it would not comment on 'rumours' in the press and would make a statement only when a final agreement on the divestment package has been reached. Rhodia said in October that it is hoping to raise €700 million through the sale of non-core assets by the end of next year, and was assessing businesses with a value of €1.3 billion.
An article in the French newspaper Le Figaro said that the company's management had completed several weeks of studies aimed at drawing up a list of disposable assets. The newspaper noted that BNP Paribas has been mandated to sell the company's silicon operations with annual sales of around €400 million, while Credit Lyonnais has been asked to find a buyer for certain elements in the company's food and additives division.
Rhodia said "speculation regarding the effect on the group's business portfolio during a process such as this is normal".
The company is selling assets to help bring down debt of €2.13 billion. Talks with its banks on renegotiating covenants on the debt are due to be concluded by the end of the year.
In October this year a restructuring drive at the company coincided with the departure of its chairman and chief executive Jean-Pierre Tirouflet. Tirouflet had been in conflict with minority shareholders who blame him for failing to improve the performance of the company following its split with Rhone-Poulenc, which merged with the German company Hoechst to form the pharmaceutical group Aventis.
The move followed a difficult financial period for the company which posted a first-half loss of €150 million and has said it expects little improvement in the last six months of 2003.