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|
In the second half of 2022, China unveiled the details of its data export regulations, providing further explanations to its existing laws and regulations on data.
The current energy crisis has reached an unsustainable level for the European chemical industry. For the first time ever, the EU imports more chemicals than it exports, both in volume and value, resulting in a trade deficit of € 5.6 bn for the first half of 2022.
Endocrine Disrupting Chemicals (also referred to as hormone disruptors or EDCs) are synthetic chemicals that are not produced by the human body and that disrupt the normal functioning of humans and animals.
The shipping industry is now returning to normality and is in a downward spiral. The cost of shipping goods from China has slumped to the lowest level in more than two years as the world economy stumbles, dimming prospects for container carriers that turned in record profits during the pandemic.
No precipitous plunge in container shipping rates, just ‘orderly’ decline.
The global food and beverage market size is expected to grow from $5.8 trillion in 2021 to $6.4 trillion in 2022 at a growth rate of 9.7%. The food and beverage market size is expected to grow to $8.9 trillion in 2026 at a compound annual growth rate of 8.7%.
The amendment makes QR codes mandatory on every active pharmaceutical ingredient. The Amendment Rules will come into force from January 01, 2023.
On June 22, 2022, the Commission adopted pioneering proposals to restore damaged ecosystems and bring nature back across Europe, from agricultural land and seas, to forests and urban environments. The Commission also proposes to reduce the use and risk of chemical pesticides by 50% by 2030.
According to New York Times, in a small clinical trial, 18 patients took a drug called Dostarlimab for around six months, and in the end, every one of them saw their tumours disappear.