Clariant has reached an agreement with Heubach Group and SK Capital Partners to divest its Pigments business.
A consortium formed by Heubach Group and SK Capital Partners has signed an agreement to acquire Clariant’s Pigment business. Therefore, Clariant has completed its divestment program and will be reinvesting for a 20% ownership stake in the new combined business.
The transaction, which is subject to customary closing conditions and regulatory approvals, is expected to be concluded in the first half of 2022 at an Enterprise Value (EV) of CHF 805 million to CHF 855 million on a cash and debt free basis, depending on an earn-out payment of CHF 50 million contingent on the 2021 financial performance of Clariant’s Pigments business. Clariant’s share of participation in Infraserv Höchst, however, is not part of the transaction.
After Clariant’s reinvestment alongside Heubach and SK Capital in the ultimate holding company, the combined business will be a global pigments company with 3,000 employees circa and it is expected to generate over € 900 million in annual sales. This opportunity allows Clariant to further benefit from the improving profitability of the Pigments business, that results from the initiated efficiency program, and to participate in the future growth with Heubach Pigments business.
“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 program 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”, stated Conrad Keijzer, Chief Executive Officer at Clariant.
“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,” added Johann Heubach, Chief Executive Officer of the Heubach Group. “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 specialty applications fields with industry leading products and services”.
“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”, concluded Aaron Davenport, SK Capital’s Managing Director.
Having previously divested the Healthcare Packaging and Masterbatches businesses, the Pigments business divestment concludes Clariant’s transformation into a global specialty chemical company with above-market growth and higher profitability, since the proceeds will be used to invest into growth projects within the core Business Areas and fund the performance improvement programs as well as strengthen Clariant’s balance sheet.