Paris, October 18, 1999 -- Rhodia and Applied Silicone Corporation have just signed a letter of intent concerning the acquisition by Rhodia of certain of Applied Silicone Corporation’s medical and paramedical application businesses, excluding its breast implant business.

This operation will strengthen Rhodia’s existing portfolio in this sector with Applied Silicone Corporation’s specialist technologies and competencies. The business concerned by this acquisition covers a whole category of speciality silicones (elastomers, fluids, gels, adhesives, etc.) intended for medical and paramedical applications such as tubes and technical parts for medical devices (respirators, transfusion systems, etc.)

With this acquisition, and through its Rhodia Silicones enterprise, Rhodia will boost its growth in the United States and throughout the world, on a booming market segment, taking full advantage the high performance potential of speciality silicones.

The conclusion of the transaction remains subject to the final agreement of both parties and the approval of appropriate regulatory authorities in the United States.

Applied Silicone Corporation is an independent American silicones producer, specialised in silicones for medical and paramedical applications. It has one production site, located at Ventura (in California) and employs 85 people.