Clariant, a focused, sustainable and innovative speciality chemical company, has reached definitive agreements for the divestment of its Pigments business to a consortium of Heubach Group (“Heubach”) and SK Capital Partners (“SK Capital”) at an Enterprise Value (EV) of CHF805M to CHF855M on a cash and debt free basis, depending on an earn-out payment of CHF50M contingent on the 2021 financial performance of Clariant’s Pigments business. This represents a multiple of 10.7 to 11.4 times the stand-alone adjusted 12-month EBITDA per April 2021 (LTM).

At the time of closing of the transaction, Clariant will reinvest to become a 20% shareholder alongside Heubach and SK Capital in the ultimate holding company. The combined business will be a global pigments player with approximately 3000 employees generating more than €900M in annual sales and strong service and production capabilities across the globe. The reinvestment enables Clariant to further benefit from the improving profitability of the Pigments business resulting from the initiated efficiency programme and to participate in the future growth opportunities, as well as synergies of the combination with the Heubach Pigments business.

The transaction is subject to customary closing conditions and regulatory approvals and is expected to close in the first half of 2022. The share of the participation in Infraserv Höchst, Germany, attributable to Clariant’s Pigments business is not part of this transaction.

“We are pleased to announce the agreement with Heubach and SK Capital for the sale of our Pigments business. This achievement represents a final step in the divestment programme and portfolio repositioning announced in July 2018. We are confident that with Heubach and SK Capital, we have found the right owners of this business, for our customers, our colleagues and our other stakeholders. Now our focus can fully be on growing revenue and profitability of our core Business Areas: Care Chemicals, Catalysis and Natural Resources”, said Conrad Keijzer, Chief Executive Officer of Clariant.

Johann Heubach, Chief Executive Officer of the Heubach Group, noted “We have been in pigments for more than 200 years. My late father and I set out to drive consolidation in the pigments industry and the combination of Heubach and Clariant Pigments is a major milestone in this vision. The fit between Heubach and Clariant Pigments is perfect. The combination of industry leading technologies, a product portfolio serving a wide range of customer requirements and global production and service footprint will give the newly formed Heubach Group the ability to serve our global customer base in the coatings, plastics, inks and speciality applications fields with industry leading products and services.”

Aaron Davenport, a Managing Director of SK Capital, noted “Clariant Pigments is a premier global colorant solutions provider and, together with our new partners, the Heubach Group and Clariant, we see a tremendous opportunity to create significant value for all stakeholders.”

Once completed, Clariant will have finalised its intended divestments as part of its portfolio upgrade, having previously divested the Healthcare Packaging and Masterbatches businesses. The Pigments divestment concludes Clariant’s transformation into a high value speciality chemical company with above-market growth, higher profitability and stronger cash generation. The proceeds of the Pigments divestment will be used to invest into growth projects within the core Business Areas, execute the strategy along sustainability and innovation, fund the performance improvement programmes, as well as strengthen Clariant’s balance sheet and fund the reinvestment into the Clariant-Heubach combined Pigments business.

Clariant’s Pigments business is a leading global provider of superior quality organic pigments, pigment preparations and dyes, which are used in many applications such as the automotive industry, for industrial and architectural coatings, as well as for the plastics industry. In 2020, the unit’s 1900 employees generated approximately CHF850M in sales on a stand-alone adjusted basis.

Definitive agreements signed by a consortium of Heubach Group and SK Capital Partners to acquire Clariant’s Pigments business
Enterprise Value of CHF805M to CHF855M, representing a 10.7x to 11.4x stand-alone adjusted EBITDA multiple per April 2021 (LTM) depending on an earn-out payment of CHF50M
Clariant will be reinvesting for a 20% ownership stake in the combined business
Closing anticipated in the first half of 2022

Resource:
https://polymerspaintcolourjournal.com/news/clariant-to-sell-its-pigments-business-to-heubach-and-sk-capital?utm_source=Adestra&utm_medium=email&CID=003D00000242tSZIAY&utm_campaign=June%202021%20Newsletter%202%20-%20Subscribers&utm_content=C3683635&CNAME=Onward%20Chemicals%20Pvt.%20Ltd

More News
A promising new class of psychotropic drugs
News · 16/07/2021

A newly developed drug stabilizes dopamine and serotonin levels using a novel mechanism. It effectively treats psychosis in patients with schizophrenia, and researchers are testing its efficacy for Parkinson’s disease as well.

READ MORE
Trained viruses prove more effective at fighting antibiotic resistance | Practice boosts phage potency in evolutionary battleground with deadly bacteria
News · 16/07/2021

The threat of antibiotic resistance rises as bacteria continue to evolve to foil even the most powerful modern drug treatments. By 2050, antibiotic resistant-bacteria threaten to claim more than 10 million lives as existing therapies prove ineffective.

READ MORE
Electrospun Nanofiber Membrane Technology I New alternative to seawater desalination to produce drinkable water in minutes
News · 16/07/2021

According to the World Health Organization, about 785 million people around the world lack a clean source of drinking water. Despite the vast amount of water on Earth, most of it is seawater and freshwater accounts for only about 2.5% of the total. One of the ways to provide clean drinking water is to desalinate seawater. The Korea Institute of Civil Engineering and Building Technology (KICT) has announced the development of a stable performance electrospun nanofiber membrane to turn seawater into drinking water by membrane distillation process.

READ MORE
UK REACH major threat to UK manufacturing says coatings industry survey
News · 01/07/2021

The latest survey of British Coatings Federation (BCF) members reveals UK coatings manufacturers are increasingly concerned about the effects of the new UK chemical regulations.

READ MORE
Key reasons global shipping costs will continue to rise!
News · 01/07/2021

Shipping costs have risen sharply and fierce competition for ocean freight capacity is the new normal. With new capacity only slowly coming onstream, freight rates are expected to continue to reach new highs this year and will remain above their pre-pandemic levels in the longer term.

READ MORE
Lynparza shows promise in preventing cancer recurrence
News · 16/06/2021

AstraZeneca and MSD’s Lynparza (olaparib) has shown efficacy in preventing cancer recurrence in patients with germline BRCA-mutated (gBRCAm) high-risk human epidermal growth factor receptor 2 (HER2)-negative early breast cancer.

READ MORE
Is ammonia the fuel of the future?
News · 15/06/2021

Ammonia saved the world once; it might do it again. A century ago, the world faced a looming food crisis. A booming population was pushing farmers to grow crops faster than nitrogen-fixing bacteria in the soil could keep up, and the South American deposits of guano and natural nitrates they applied as fertilizer were dwindling.

READ MORE
Lipids – The unsung vaccine component
News · 15/06/2021

Lipids are an unsung component in the two mRNA-based shots, the only vaccines to be approved so far in the US. Naked mRNA quickly degrades in the body and can trigger an unwanted immune reaction. To get the genetic material to its target cells, vaccine developers combine it with a mixture of several sophisticated lipids to form lipid nanoparticles, or LNPs. mRNA vaccine producers use a package of 4 lipids to formulate their LNPs

READ MORE
Short-lived romance: Pharma industry facing heat for Covid vaccine failures, greed
News · 01/06/2021

An unprecedented push to manufacture billions of doses this year alone has led to supply bottlenecks, putting firms such as Pfizer and AstraZeneca Plc in the firing line of angry government customers. Now the industry is taking heat for closely guarding its intellectual property.

READ MORE