Evonik Acquires Remaining Shares of Chinese Degussa Lynchem

• Strengthening of Exclusive Synthesis Business

Thursday, March 6, 2008

Evonik Industries AG has acquired the remaining 49 percent of its former joint venture Degussa Lynchem Co. Ltd., Dalian, China, from the Chinese shareholders Yuncai Wang and Jingkun Wang. By this transaction Degussa Lynchem has become a wholly owned subsidiary of Evonik. The shares are held through Evonik Degussa China Co. Ltd. Financial details of the acquisition have not been disclosed. The transaction is subject to the approval of government authorities, which is expected to be received by end of March.

The joint venture between Evonik and its Chinese partners was established in 2006 by the purchase of a 51 percent stake in Lynchem Co. Ltd. in Dalian, China.

“In taking over the remaining shares, we are strengthening our global Exclusive Synthesis business and further expanding it in line with our successful concept of horizontal integration,” says Dr. Alfred Oberholz, member of the Executive Board of Evonik Industries AG with responsibility for the Chemicals Business Area.

Evonik is the first European supplier to have implemented the concept of horizontal integration in exclusive synthesis. This allows for regulated intermediates and starting materials, as well as active ingredients that are not patent protected, to be produced at competitive cost in China. At the same time, customers benefit from Evonik’s technology portfolio at its European sites, and from its long experience in governmental and patent law regulations regarding the manufacturing of patent protected intermediates and active ingredients.

Evonik’s Exclusive Synthesis Business Line concentrates on customer-specific production of pharmaceutical intermediates, active ingredients, and fine chemicals with stringent quality requirements. With its worldwide production and research network, the business line offers a comprehensive service, ranging from synthesis development on the laboratory scale to commercial production in FDA-certified facilities (FDA = Food and Drug Administration, USA). The Exclusive Synthesis Business Line is part of the Health and Nutrition Business Unit.

Company information

Evonik Industries AG is the creative industrial group which operates in three highly profitable, promising business areas: Chemicals, Energy and Real Estate. Evonik is a global leader in specialty chemicals, an expert in power generation from hard coal and renewable energies, and one of the largest private residential real estate companies in Germany. Our strengths are creativity, specialization, continuous self-renewal, and reliability.

Evonik Industries is active in over 100 countries around the world. In fiscal 2006 around 43,000 employees generated sales of € 14.8 billion and operating Profit (EBIT) of over € 1.2 billion. Evonik plans to enter the capital market in the first half of 2008.

Disclaimer

In so far as forecasts or expectations are expressed in this press release and where our forward looking statements concern the future, these forecasts, expectations and statements may involve known or unknown risks and uncertainties. Actual results or developments may vary, depending on changes in the operating environment. Evonik Industries AG assumes no obligation to update the forecasts, expectations or statements contained in this release.