Arkema announced today that it is to acquire ArrMaz Products (Mulberry, Florida), a producer of specialty surfactants for crop nutrition, mining and infrastructure, from Golden Gate Capital for $570 million. ArrMaz has sales of some $290 million, an EBITDA margin of 18% and around 2.5% of capex to sales. The acquisition reinforces Arkema’s specialty chemicals portfolio. Arkema has identified synergies of some $15 million by 2023, mainly in the purchasing and commercial fields. The acquisition is expected to have an accretive impact on cash and earnings per share from the first year of integration and will contribute to the group’s 2020 and 2023 objectives.
The purchase price corresponds to an enterprise value to EBITDA multiple of 10.8x, or, including synergies, about 7x 2023 EBITDA. Arkema says the acquisition is in line with its ambition to achieve over 80% of sales in specialties by 2023.
ArrMaz will be integrated into performance additives, one of the three pillars which will drive growth of Arkema’s high performance materials division, along with adhesives and technical polymers. ArrMaz provides tailored solutions for its customers in a variety of industrial markets. In the crop nutrition market, ArrMaz offers additives that enhance the efficiency and quality of fertilizer production and distribution and in the mining market, it supplies a wide range of additives to help optimize grade recovery and process performance in mining operations. In the infrastructure market, ArrMaz supplies additives that help improve road longevity and recyclability.
ArrMaz has built an extensive commercial presence in North America, South America, Asia and in the fast-growing regions of the Middle East and Africa, where it recently opened new facilities. The company employs 400 people and operates nine manufacturing sites worldwide. Combined with Arkema’s expertise in formulation and specialty surfactants, the acquisition is highly complementary in terms of geography as well as commercial and technological capabilities, Arkema says, adding that following the acquisition it will be well positioned to accelerate growth in legacy markets and enter new segments, such as additives for nutrients, lithium extraction and oil & gas process aids.
Completion of the transaction is expected in the summer of 2019, subject to approval by relevant antitrust authorities. The Valence Group was Arkema’s adviser.
By Natasha Alperowicz
Source: Chemical Week
The future CEO of thyssenkrupp Uhde, Nadja Håkansson, has held various management positions at Siemens and Siemens Energy and looks back on over 18 years of national and international experience in the areas of supply chain management, operations, sales and corporate management.
Neste and South Korean company Lotte Chemical have partnered on a project to elevate the sustainability profile of chemicals and plastics. The partnership’s ambition is to replace fossil resources with renewable raw materials that offer a lower carbon footprint.
At least the confidence in the chemical sector has been seeing an upward trend and the trade balance is recovering as destocking seems to be coming to an end. Citing projections from the European Central Bank, CEFIC states that the level of inflation is expected to fall from 5.4% in 2023 to 2.3% in 2024.
