Posted February 22, 2002 Manufacturing News Hercules Sells Water Treatment Business to GE Hercules Inc. (Wilmington, Del.; www.herc.com) announced it's agreement to sell the Water Treatment business of its BetzDearborn Division to GE Specialty Materials (Wilton, Conn.; www.gespecialtymaterials.com), a unit of General Electric Company. The Paper Process Chemicals business, approximately one-third of the BetzDearborn company purchased by Hercules in 1998, will remain with Hercules. In addition, Hercules will have an agreement with GE to distribute and service BetzDearborn's water treatment products to the pulp and paper industry. The transaction is subject to regulatory and other customary approvals, and is expected to close in spring 2002. The purchase price is $1.8 billion in cash, with net after tax proceeds available for debt reduction of approximately $1.665 billion. "Last year, the Company was in a difficult financial situation, carrying too much debt," said Dr. William H. Joyce, Chairman and Chief Executive Officer of Hercules. "A corporate-wide work process program to reduce costs has made the debt manageable and all of our businesses more valuable. The sale of the water treatment business is the second step in the program and will sharply reduce our debt and permit us to better support the corporation's remaining businesses and enhance shareholder value from a position of strength." Since January 2001 the Company has received net proceeds of approximately $2 billion. Hercules will now focus on the future of its remaining businesses. These include Aqualon, Pulp and Paper (including the retained BetzDearborn Paper Process chemical products acquired in 1998), FiberVisions, and Rosins and Terpenes. The Manufacturing Report © Copyright 2002 by Lionheart Publishing, Inc. All rights reserved. E-mail Editorial Dept: tmr-editorial@lionhrtpub.com Lionheart Publishing, Inc. 2555 Cumberland Parkway, Suite 299, Atlanta, GA 30339 USA Phone: 770-431-0867 | Fax: 770-432-6969 E-mail: lpi@lionhrtpub.com