Chemicals sector comment – March 2013

Dato

US diversified chemicals group Rockwood is looking to sell its Performance Additives division and Sachtleben business as a combined entity. The sale process comes on the back of the group’s rumoured sale of its CeramTec ceramics materials division and its Metal Sulphides unit.

By combining the Performance Additives division and Sachtleben together, Rockwood will bring together assets with combined EBITDA of in excess of $300m. It will also open up the process to a wide range of large financial sponsors such as Apax, Bain, Blackstone, Carlyle and CVC. Potential trade interest could come from buyers such as Cristal, the Saudi titanium dioxide producer and owner of Millennium Chemicals. Any appetite for the businesses is likely to be driven by a rebound in construction and consumer markets.

Rockwood’s Performance Additives division brings together its Color Pigments & Services business, its clay-based Additives business including Southern Clay Products and its Wood Treatment business which includes Chemical Specialties, Mineral Research & Development and its Viance joint-venture with Dow. Sachtleben is a producer of titanium dioxide, barium sulphate and zinc sulphide for architectural and decorative coatings, coil coatings, composites, elastomers, engineered plastics, industrial paints and coatings, masterbatches, packaging inks, pigments, polyolefins, polyvinyl chloride, powder coatings and UV absorbers.

Rockwood recently acquired Kemira’s 39% stake in Sachtleben for $131m.

Deals

Dynea Chemicals Oy has spun off its European phenolic resis unit which includes the assets of Aycliffe in the UK, Brebieres in France, Erkner in Germany, Hamina and Joroinen in Finland, Trzemeszno in Poland and Rasnov in Romania to a newly formed company Prefere Resins Company (PRC). Dynea is now said to be working to divest PRC.

Italmatch Chemicals SpA has acquired Thermphos International BV’s phosphorus chlorides operations and Dequest phosphonates business. The acquisition will enable Italmatch to consolidate and grow the business long-term with the aim of becoming a leading global player in specialty chemicals focused on water management, plastics and lube.

Brenntag AG has agreed to acquire the assets of Lubrication Services LLC, a North American multi-regional distributor of lubricants and chemicals to the oil and gas industry. The acquisition will allow Brenntag to further increase their participation in the expected rapid growth related to the shale market.

BASF Polska Sp z.o.o. has completed the acquisition and transfer of intangible and legal assets connected with the production of toluene diisocyanate (TDI) from Ciech Group SA. TDI is a key component for the polyurethane industry and the acquisition will enable BASF to further develop its leading international position in the isocyanates market.

Singapore state investment fund Temasek Holdings Pte Ltd is to invest more than USD 770m in Evonik Industries AG, the German chemicals group. Temasek will receive a 5% stake in exchange for its investment whilst Evonik has secured a so-called anchor shareholder before its proposed IPO.

Gabriel Performance Products LLC has signed a contract with BASF SE to transfer the BASF Capcure® business to Gabriel. The Capcure mercaptan-based curatives which are used in expoxy curing applications will strengthen Gabriel’s position in the epoxy curing market.

Bayer CropScience AG has acquired the soy germplasm bank from Melhoramento Agropastoril Ltda, the soybean seed company Wehrtec and the soy business of Agricola Wehrmann. The acquisitions will enable Bayer CropScience to enhance its research and breeding of soybean varieties in Brazil.

EMS-Chemie Holding AG has acquired the remaining 50% in D PLAST-EFTEC, an automotive supply business active in the specialised fields of bonding, coating, sealing and damping in Central and Eastern Europe. With this acquisition, EMS intends to further increase business in the growth markets of Central and Eastern Europe and to strengthen its leading market position as a global automotive supplier.

Symrise AG has acquired the global fragrance business of the Belmay Group Inc, an international developer and manufacturer of fragrances and perfume oils. The acquisition enables Symrise to further progress in the company’s strategy to grow in the fine fragrance, personal care and air care segment.

Private equity firms Groupe Siparex SA and Naxicap Partners SA have acquired 80% of Industrie de Produits Chimiques, a French hygiene and maintenance products manufacturer. The acquisition provides an exit for Ciclad SAS and Michel Fraisse Gestion & Investissement SA.

Premier Tech Ltd has acquired Falienor SA, a French growing medium producer. With this acquisition Premier Tech integrates the renowned expertise of some 110 skilled team members to its European team which is now close to 450.

Impreglon SE has acquired Gossman Pre-Applied Centre GmbH and ALZI Metallveredlung GmbH, both coatings manufacturers based in Bad Camberg and Wuenschendorf /Gera. With their surface technologies both plants ideally complement the “One Stop Shop” concept of the Impreglon group.

Israel Chemicals Ltd has agreed to acquire the phosphorus pentasulfide (P2S5) business assets and operations of Thermphos International BV. The acquisition complements ICL’s global presence in phosphorous-based specialty ingredients and is a step forward in ICL’s global expansion strategy.

Elementis plc has acquired the assets of Hi-Mar Specialty Chemicals LLC, a US coatings additives company for USD 33m. The acquisition will further expand Elementis’s product and technical service offering in the high value segments of coatings, construction and oilfield drilling industries.

Krahn Chemie GmbH has acquired ICH Benelux BV, a supplier of high quality raw materials and technical services to the coatings industry. The acquisition significantly expands Krahn Chemie’s market position in the distribution of speciality chemicals.

Scott Bader Inc has acquired ATC Formulated Polymers Inc, a manufacturer of a wide range of bonding, tooling, fairing, compression moulding and other polyester and vinylester based pastes, supplying largely into the North America composites industry. The acquisition will make Scott Bader and ATC a global leader in the structural adhesives and bonding pastes business.