Ashland says that it has signed a definitive agreement to sell the industrial biocides assets within the company’s specialty ingredients business segment, to Troy Corp. (Florham Park, NJ), a global leader in microbial control products and performance additives. Financial terms of the agreement have not been disclosed.
Industrial biocides—which help control and prevent the growth of bacteria, mold and other microorganisms in a wide range of coatings, construction materials and energy products—accounted for about 2% of specialty ingredients’ sales for the 12 months ended 31 March 2015, Ashland says. The company did not disclose the sales figure for the business segment during that 12-month period. In the company’s fiscal year ended 30 September 2014, the specialty ingredients business segment generated sales of about $2.5 billion.
Specialty Ingredients’ lineup of preservatives products, which is focused on consumer markets, is excluded from the agreement with Troy and Ashland is committed to retaining and growing that strategic business, the company says.
Industrial biocides is a non-core product line and the divestment is expected to close within 60 days, subject to standard closing conditions and completion of required employee information and consultation processes, Ashland says.
“This divestiture reflects our continued focus on driving growth within the higher-margin core businesses where we offer greater value to our customers,” says Luis Fernandez-Moreno, Ashland senior v.p. and president of Ashland’s chemicals group. “As a smaller player within the industrial biocides market, Ashland has lacked the critical mass needed to be successful. Troy is better positioned to capitalize on growth opportunities within this segment and we are committed to working with them to ensure a seamless transition for our industrial biocides employees and customers,” Fernandez-Moreno says.
Troy, which was founded in 1950, develops and manufactures specialty materials that enhance the properties and performance of its customers’ products and processes, and helps manufacturers meet global requirements for compliance and sustainability, Ashland says. Troy has sales offices throughout the United States, Canada, Europe, Asia, and Latin America.
“With the addition of Ashland’s industrial biocides business, Troy’s portfolio of preservatives will be enhanced, delivering even more value, performance, and sustainability to the marketplaces served,” says W. Brian Smith, v.p. at Troy.
Ashland has recently divested several non-core assets. Earlier this year, Ashland agreed to sell its Valvoline car-care assets, including manufacturing and distribution facilities at Hernando, MI, to Niteo Products, a newly formed affiliate of Highlander Partners (Dallas), a private investment firm. Late last year, Lion Copolymer (Geismar, LA) acquired Ashland’s styrene-butadiene rubber elastomers business, for an undisclosed amount. In 2014, Ashland and Clariant sold their foundry chemicals joint venture, ASK Chemicals (Hilden, Germany), to investment funds affiliated with Rhône, a London- and New York–based private equity investment firm. In August 2014, Ashland completed the divestment of its water technologies business, a supplier of water treatment and pulp and paper process chemicals, to private equity firm Clayton, Dubilier & Rice (CD&R; New York) for $1.8 billion. With these divestments, Ashland aims tp focus on the company’s core specialty chemicals business.
By Deepti Ramesh