Sector News

Advent-led GTM buys Brazil chemical firm quantiQ for $172 million

January 11, 2017
Chemical Value Chain

GTM Holdings SA, Latin America’s No. 1 independent distributor of chemical products, has agreed to pay 550 million reais ($172 million) for Brazilian peer quantiQ Distribuidora Ltda, in an effort to gain more foothold in the region’s biggest country.

Under terms of the deal, GTM Holdings, which is owned by private equity firm Advent International Corp, will pay 450 million reais when the deal closes, with the remainder being disbursed within the next 12 months. The acquisition of quantiQ, formerly part of Brazil’s Braskem SA, is GTM’s third since June.

The deal will allow GTM, which was founded in Guatemala 31 years ago, to broaden the wide array of suppliers for the company’s 12,000 customers in 12 Latin American countries, said Manuel Garcia Podestá, a director at Advent. An advantage of the quantiQ deal is the proximity it will create with Braskem (BRKM5.SA), Latin America’s No. 1 resin maker, he added.

“This deal is transformational for GTM in the sense that it will significantly expand the scope of our suppliers, creating value and synergies for GTM’s customers,” Garcia Podestá said in an interview from Bogota, where he is based.

Mergers and acquisitions among Latin America’s chemical and industrial companies are poised to gain traction this year, as two years of a deep downturn and an ongoing recovery in global prices are making some targets attractive for large global players, bankers said.

Room for acquisitions of chemical distributors in Brazil remain large, Advent’s Garcia Podestá said, noting that GTM will gauge organic growth or acquisition opportunities carefully. Brazil’s top ten chemical distributors control about 30 percent of the market.

For GTM, the purchase of quantiQ will give it access to a portfolio of over 5,000 clients in the country in 50 different market segments ranging from cosmetics to pharmaceuticals and food processing.

In turn, Braskem, which recently signed a leniency deal with Brazilian and U.S. authorities over its involvement in a graft and bribery scandal in Brazil, could be looking to divest assets as it seeks to cut costs by 400 million reais a year.

The sale of quantiQ “is in line with Braskem’s strategy of reinforcing the focus on petrochemical operations,” São Paulo-based Braskem said in a Tuesday securities filing.

The transaction hinges on regulatory approval. Itaú BBA SA, the investment-banking unit of Itaú Unibanco Holding SA and law firm Lobo & de Rizo Advogados, advised GTM on the transaction.

By Guillermo Parra-Bernal

Source: Reuters

comments closed

Related News

October 2, 2022

Trinseo announces potential closure of Boehlen, Germany Styrene Plant

Chemical Value Chain

Trinseo (NYSE: TSE), a specialty material solutions provider, announced it has initiated an information and consultation process with the Works Council of Trinseo Deutschland GmbH regarding the potential closure of its styrene monomer production site in Boehlen, Germany.

October 2, 2022

Celeste Mastin appointed H.B. Fuller President and CEO, succeeding Jim Owens upon his retirement

Chemical Value Chain

H.B. Fuller Company announced that Celeste Mastin, Executive Vice President and Chief Operating Officer, will succeed Jim Owens as H.B. Fuller’s President and Chief Executive Officer, effective December 4, 2022. Upon assuming the role, Mastin will also join the Company’s Board of Directors, replacing Owens, who will be retiring.

October 2, 2022

LyondellBasell realigns executive team, forms circular and low-carbon solutions business

Chemical Value Chain

New LyondellBasell CEO Peter Vanacker, who joined the company from Neste in May, today named his senior executive team and outlined organizational changes, including creation of a circular and low-carbon solutions business. All changes will be effective 1 October.