By Sam Waltz
Amid all the uncertainty of another DuPont Co. spinoff, Chemours, and whether it will stay in Delaware, the remnants of a long-ago DuPont spinoff seem to be prospering in the First State.
Croda, a global environmentally friendly surfactant maker, is growing in the shadows of the Delaware Memorial Bridge, just off Interstate 295 at Del. 9, in an area known as Atlas Point.
In fact, Croda, a UK-based corporation traded on the London Stock Exchange, is investing $170 million in an expansion scheduled for 2017 completion to serve its global markets with non-ionic surfactants from plant-based bio-ethanol rather than petrochemicals.
Put plainly, Croda is replacing its oil-based products with plant-based products that are used in a variety of everyday products from detergents to cosmetics.
The Atlas Point facility dates to about 1937 when it was used by the Atlas Powder Co. for a variety of explosives and armament-type products. Atlas Powder was created as one of two spinoffs (Hercules, now Ashland, was the other) about 1912 when the U.S. government decided to break up the DuPont Co., founded 1802, because it felt it had come to monopolize the explosives and gunpowder industries.
Atlas and Hercules each thrived for decades in the 1900s, until Atlas Powder was acquired by the United Kingdom’s Imperial Chemical Industries, known more locally as ICI, particularly via its US headquarters on U.S. 202 in Fairfax.
In the mid-1990s, ICI globally did what the DuPont Co. did this year. It created a separate company, Zeneca, in which it puts growth products, principally pharmaceuticals, and it left its commodity chemical businesses in the parent ICI company, subsequently spinning off many of them in the U.S. subsidiary Uniqema.
DuPont left its growth businesses under the DuPont brand and moved its commodity businesses to the newly created Chemours brand, which it spun off to DuPont stockholders.
About 2006, Croda — a combination of the names of the two English founders in 1925 of the company, Mr. Crowe and Mr. Dawe, according to Croda’s website — acquired the remnants of ICI including Uniqema, and ICI’s Atlas Point facility.
Today, Croda does business with about 3,500 employees in 30 countries, and it does about 1 billion pounds (UK) of business. DuPont does business worldwide, with about 50,000 employees and about $25 billion in sales.
“The expansion of our Atlas Point facility will add about 30 jobs and allow the retention of about 47 others among the present 200-member work force,” said Kevin Gallagher, the Edison, N.J.-based president of Croda USA.
“Croda has made a significant contribution toward the future of Delaware’s economy and environment. We are proud to partner with a company that invests as heavily in its workforce as it does the world around them,” Gov. Jack Markell said.
“Croda is also the latest example of a Delaware-based company that is finding new and better ways to make existing products. By providing more sustainable products to its customers, the company has put itself in an excellent position for future growth,” Gov. Markell added.
Gov. Markell kicked in $2.5 million to Croda on behalf of Delaware taxpayers, about $1.5 million towards capital costs of the expansion and another $1 million in training and employment grants.
“It’s a ‘virtuous circle’,” Gallagher said of Croda’s decision to expand in Delaware, when it could have gone many other places. “Some of it has to do with the scale and scope of that facility, where, in the Croda world, it is the single largest manufacturing by footprint, about 140 acres. The Atlas Point facility has attracted a lot of capital investment, over $100 million since the acquisition, which makes it more attractive for future investment. The more investment that gets made makes it more attractive for more investment.”
Croda has other North American facilities in Central Pennsylvania, not far from State College and Williamsport. “But it’s the labor pool in Delaware that’s close by our site, it’s a much richer labor pool.”
Gallagher, who was raised in Jersey City in the Hudson County, N.J., area, is a 1980 grad of the New Jersey Institute of Technology with a bachelor’s degree in chemical engineering. He’s been at Croda 37 years, and he became president of its North American operations in 1998. He describes himself as an “R&D guy, a science guy” who became a business guy.
Gallagher confides that little “institutional memory of the ICI days” remains in the Croda organization, that it has changed so much. “It’s really the creative destruction that goes along with capitalism.”
In this case, Gallagher likened it to the rise and then the decline of diversified conglomerates. “After a period of building up companies, they began to disassemble and go back to core businesses,” he added. “ICI was diverse, one of the largest companies in the world, everything from petrochemicals to pharma, and everything in between.”
Gallagher also went out of his way to credit Gov. Markell and former DEDO Secretary Alan Levin as well as Senators Tom Carper and Chris Coons, as well as County Executive Tom Gordon. “Your local officials could not have been more helpful, more encouraging,” he said.
“The future looks very encouraging for Croda in Delaware, very encouraging,” said Gallagher.