Dow Chemical Company (DOW) said Friday morning that it is divesting its global polypropylene licensing and catalysts business, selling it to W.R. Grace & Co. (GRA) for $500 million, as the chemical giant continues to trim its non-core businesses. 

W.R. Grace is a supplier of polyolefin catalyst technology and has the broadest portfolio of polyolefin catalyst technologies of any independent polyethylene/polypropylene catalyst producer.  Polypropylene is a thermoplastic polymer used in a variety of products, including packaging, labeling, automobile products and textiles. In 2012, Grace recorded revenue of $3.2 billion and profits of $94.1 million.

Dow reported back in March that it intended to divest $1.5 billion in assets in the next year-and-a-half as it seeks to build competitive positions in attractive markets such as electronics, water, packaging and agricultural sciences. The UNIPOL plastic additives unit sold today was mentioned then as a business is was looking to unload.

Last October, Dow, the largest U.S. chemical maker by revenue and 82nd biggest S&P 500 component by market cap, announced that it planned to close 20 plants and eliminate 2.400 jobs as part of its cost-cutting initiatives.

The sale to W.R. Grace includes Dow’s polypropylene catalysts manufacturing facility at Norco, Louisiana, customer contracts, licenses, intellectual property and inventory.  About 90 employees will be going to W.R. Grace as part of the deal.  Midland, Michigan-based Dow expects to report a gain on the sale and direct net proceeds towards paying shareholders, debt reduction and cash for growth.

On September 26, Dow announced a new licensee of the technology in Qinghai Provincial Mining Co., Ltd.. Qinghai licensed the UNIPOL™ Polypropylene Process Technology from Union Carbide Chemicals & Plastics Technology LLC, a wholly owned Subsidiary of Dow, with plans to use the technology in a Chinese facility scheduled for start-up in 2016. The deal was the third UNIPOL PP Technology license signed in 2013.  There are currently 48 operating lines worldwide and 15 reactor lines under design and construction using UNIPOL polypropylene technology.

“The addition of Dow’s world-class polypropylene products and process technology is a significant enhancement of Grace’s market-leading catalysts franchise,” said Fed Festa, chairman and chief executive at Grace.

The transaction is expected to close by the end of the year.

“Today’s announcement is another clear demonstration of Dow’s rigorous focus on selectively shifting our portfolio away from assets that are no longer a strategic fit and optimizing their value,” said Andrew N. Liveris, Dow’s chairman and chief executive officer.

Liveris reiterated that Dow intends to sell more non-core assets over the next year.

Shares of DOW are trading lower by 15 cents at $40.25 on the news, while shares of GRA have climbed 1.6 percent to $89.39.