Corporate History: Lubrizol Corporation

Lubrizol is a major corporation based in the Greater Cleveland area. Here is a short history of the company. Learn more about Lubrizol here.

The company that eventually became Lubrizol was founded in 1928 by the Smith (Kelvin, Kent [Pictured at left], and Vincent) and Nason (Alex and Frank) brothers, along with their friend, Thomas James.

Chemistry was in the Smiths' blood; all three had worked at Dow Chemical, a company their chemist father helped start. Known originally as The Graphite Oil Products Company, Lubrizol's first product, Lubri-graph, was a suspended graphite and oil product designed to keep car springs quiet. Following the success of their anti-squeak product, the principals turned their attention to the gunk that built up from the mineral oil used in car engines. Cars of the era overheated often and pistons frequently became stuck from excessive heat or sludge build-up. Graphite Oil chemists discovered that the addition of chlorine to lubricants solved the overheating problem. The new product (and later the company) was named Lubrizol.

Alex Nason went to Detroit in 1935 and convinced General Motors to add Lubrizol to its list of recommended products. Following that success Lubrizol was used extensively during WWII by the military, which established performance standards. During the war the company stopped producing lubricants and concentrated solely on additives, including rust inhibitors, detergents, and chemicals to slow oil breakdown.

After WWII performance standards for cars were set, and Lubrizol cleaned up, having patented many ingredients and processes used to manufacture lubricants. By the 1950s the privately held corporation was the #1 petroleum additive company in the world. It was during this time that the company made its first acquisition, R.O. Hull Company, a rustproofing chemicals manufacturer (it has since been sold). Lubrizol went public in 1960.

The company benefited as environmental regulations grew, since unleaded gas and catalytic converters required new additives. Lubrizol also benefited from the oil crisis in the early 1970s because the more fuel-efficient cars that resulted required new transmission fluids, fuel additives, and gear lubricants. Even the recession helped the slippery company, as industrial companies relied more on quality lubricants and additives to protect costly machinery.

Lubrizol purchased lithium battery maker Althus Corporation in 1979 and moved into biotechnology soon afterward. In 1985 the firm bought Agrigenetics Corporation and focused its biotechnology efforts on genetically altered plants. Biotechnology seemed to offer vast patent potential, whereas additives had become so effective that growth opportunities there seemed limited in comparison. However, after seven costly years, Lubrizol sold a controlling interest in Agrigenetics, which had become the sixth-largest seed company in the US, to Mycogen (acquired by Dow Chemical in 1998).

Lubrizol continued divesting noncore interests, and by 1996 it was back to being an additives company. Despite the turmoil in Asia, the company formed two joint ventures in China in 1997. The next year Lubrizol acquired the Adibis unit of BP Chemicals (now called BP Petrochemicals) and five other companies, adding a few additional percentage points to its share of the additives market. Shrinking profits caused the company to cut production by approximately 20% and its workforce by 11% between 1999 and 2000.

In 2000 Lubrizol bought RPM's Alox metalworking additive business. The next year it acquired ROSS Chem, a privately held maker of antifoam and defoaming agents used by the coatings, inks, textile, food, and metalworking industries. The company's 2002 acquisitions have included Kabo International (defoaming products), Chemron (specialty surfactants), and Lambent Technologies (silicone defoamers).

Over the next year and a half the company continued to buy when the mood struck. Lubrizol bought the additives business of Avecia in a deal that closed in January 2004. The former Avecia unit makes pigment and color dispersants for inks and coatings under the brand names Solsperse, Solplus, and Solthix. Later that year it bought up the formerly private company Noveon , which had announced its intention to go public. Noveon makes polymers and additives used in food and pharmaceuticals. The total price Lubrizol paid for the company was $1.84 billion (about $900 million cash and the assumption of another $900 million in debt). The deal triggered a restructuring that resulted in Lubrizol's two main operating segments: its former activities called Lubricant Additives and Noveon's operations making up the specialty chemicals segment.

Photo Credit: Case Western Reserve University