Private equity firm SK Capital Partners, after exploring for more than six months a possible sale of Archroma (Reinach, Switzerland), has decided to retain ownership and reinvest in the textile and paper chemicals and emulsions company.
As part of the investment, Archroma completed an offering of its credit facilities including a multi-currency revolving credit facility, a facility for capital expenditures, and term loans.
Announcing the news today, SK Capital said that it is reinvesting in Archroma in support of its ongoing initiatives to drive innovation, growth and operational efficiencies and to pursue strategic investments in both organic growth and industry consolidation.
Archroma was formed in October 2013 from the textile, paper, and emulsions businesses of Clariant and has been under SK Capital’s ownership since that time. Archroma has restructured its business by carving out three non-core divisions and establishing them as an independent and integrated company. Archroma has generated increased profitability and cash flow by improving capacity utilization, creating an integrated supply chain to simplify product flow, reducing corporate complexity by de-layering organizational structures, and improving key business processes, SK Capital says.
“We believe there is an opportunity going forward to deliver new product innovations by capitalizing on significant investments made in new technologies that improve sustainability, enhance performance and create new features and benefits coveted by our customers in the branded textiles, packaging and coatings and adhesives markets,” said Barry Siadat, managing director of SK Capital.
“Our new equity investment and recapitalized balance sheet will provide the financial and operational flexibility needed to continue building Archroma’s competitiveness and market position,” said Aaron Davenport, also a managing director of SK Capital. He added that Archroma is in a strong position to be a leading consolidator in its markets through a number of “attractive acquisition opportunities that can leverage the company’s existing platform and technology base.”
SK Capital said at the beginning of this year that it was preparing to divest Archroma, which has grown significantly since its formation. In May 2014, Archroma bought a 49% stake in M. Dohmen (Korschenbroich, Germany), which specializes in producing textile dyes and chemicals for the automotive, carpet, and apparel sectors, and in July 2015 it bought the global textile chemicals business of BASF.
HSBC Bank plc and Bank of America Merrill Lynch International acted as global coordinators, bookrunners and mandated Lead Arrangers for the new Archroma loans. Credit Suisse AG, UBS AG and ICICI Bank UK plc acted as mandated lead arrangers. Kirkland & Ellis served as SK’s legal counsel and the Valence Group provided a fairness opinion for the reinvestment. Evercore and HSBC provided SK Capital and Archroma with M&A advisory services.
By Natasha Alperowicz
Source: Chemical Week
France has launched an offshore green hydrogen production platform at the country’s Port of Saint-Nazaire this week, along with its first offshore wind farm. The hydrogen plant, which its operators say is the world’s first facility of its type, coincides with the launch of another “first of its kind” facility in Sweden dedicated to storing hydrogen in an underground lined rock cavern (LRC).
The project sets up the Hydrogen Valley in Rome, the first industrial-scale technological hub for the development of the national supply chain for the production, transport, storage and use of hydrogen for the decarbonization of industrial processes and for sustainable mobility.
At first glance, hydrogen seems to be the perfect solution to our energy needs. It doesn’t produce any carbon dioxide when used. It can store energy for long periods of time. It doesn’t leave behind hazardous waste materials, like nuclear does. And it doesn’t require large swathes of land to be flooded, like hydroelectricity. Seems too good to be true. So…what’s the catch?