€200m chemicals plant sale offers formula for growth

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Clearwater Corporate Finance advised international chemicals group Solvay on the sale of its Warrington operation to Swedish-based Perstorp for €200m million.

Solvay’s Warrington plant is a world leader in the manufacture of caprolactones under the CAPA brand, which are used in applications such as support material for top-quality shoes, advanced lacquers for the auto industry and modern orthopedic brace supports.

The business, which employs 65 people and has a turnover of over £40 million, operates in a high growth market and has several new applications under development. Perstorp is planning to double capacity and increase production of derivatives to support worldwide demand.

Solvay, which is based in Brussels and listed on the Euronext stock exchange, operates in 50 countries. The sale will allow it to focus on its key business areas.

Perstorp is a leading speciality chemicals group with manufacturing units in ten countries. It produces oxo chemicals and polyols which are used by the same customer base as caprolactones. The acquisition is the second within two months for Perstop, which in September acquired a production unit for Purified Isophthalic Acid (PIA) in Singapore.

Mats Persson, executive vice president business of Perstorp, said: “Perstorp’s aim is a long-term commitment in the caprolactone market. Meeting the market’s demand for growth, establishing collaboration with key customers and our intention to develop new application areas, are some of the measures we will introduce to create the world’s biggest caprolactone manufacturing capacity and thereby retain the current leading position.”

The acquisition was backed by French venture capitalist PAI Partners. Clearwater Corporate Finance advised Solvay on the sale, identified Perstorp as a potential purchaser and co-ordinated the different advisers working on the deal. The Clearwater team was led by partner Philip Nuttall, with John Mercer, Nick Horrocks, Arti Trivedi, Constantine Biller and Paul Jones.

Philip Nuttall said: “The sale will allow Solvay to focus on its core areas and give the caprolactones business the opportunity to develop and grow within a group that enjoys greater synergies with its own.”

The Competition Law approval was granted and the sale completed on January 31 2008.