A Korean investment group has reached agreement to acquire silicones maker Momentive (Waterford, New York) in a deal valued at $3.1 billion, including assumption of debt as well as pension and other post-retirement benefits. The acquirers include private equity firm SJL Partners (Seoul); chemical maker KCC Corporation (Seoul); and Wonik QnC Corporation (Gumi, South Korea), a maker of quartz and ceramic materials.
Momentive is one of the world’s largest producers of silicones and silanes and a global leader in fused quartz production. Momentive net sales in 2017 were $2.3 billion, an increase of 4% compared with the prior year. Segment EBITDA last year was $293 million, up 23% on volume growth in the specialty portion of its silicones business and improved performance in quartz.
KCC said in a statement that the consortium will acquire the business and then separate silicones from quartz. The silicones business, which accounted of 91% of 2017 sales, will be operated by KCC, while the remaining quartz business will be operated by Wonik. SJL will own half of each business’s shares, according to KCC. The deal is expected to close in the first half of 2019, subject to regulatory approvals.
The deal is the result of “a comprehensive review of the strategic growth and value creation opportunities available to the company,” says Jack Boss, Momentive president and CEO. “The transaction will not only allow our silicones and quartz businesses to benefit from KCC and Wonik’s industry expertise but will also further enhance Momentive global leadership position by expanding our portfolio of products, broadening our geographic reach, and strengthening our financial position.”
Momentive emerged from bankruptcy protection in 2014. Its largest shareholder is private equity firm Apollo Management, which owned a roughly 40% stake as of March 2018. Oaktree Capital Management owned a 21% stake.
“As a result of this highly strategic transaction the combined company will have superior capabilities to better compete in today’s global market.” says Steve Lim, chairman and managing partner of SJL “The combination of Momentive’s leading product portfolios, KCC and Wonik’s reach into an expanded geographical market, and SJL’s solid investment backing and private equity expertise will further position the company for long-term success.”
By Robert Westervelt
Source: Chemical Week
3M and Dow have announced they are cutting thousands of roles from their global workforces in response to economic pressures. Dow has said it will cut 2,000 jobs across its global workforce (around 5%) in a bid to save US$1bn in 2023. The company says it will also cut costs by shutting down “select assets”, though it did not note where it would halt operations.
Sweden’s state mining firm has discovered what could be Europe’s largest rare earths deposit, and says it could help the bloc reduce its reliance on imports of minerals needed to manufacture clean technologies and meet climate targets.
Henkel and Avantium have been partners since 2019, when Henkel joined the PEFerence consortium. This consortium of partners, coordinated by Avantium, aims to establish an innovative supply chain for FDCA and PEF (polyethylene furanoate).
