US speciality-chemicals concern OM Group Inc. said it has bought German speciality-chemical concern Degussa AG“s Degussa Metals Catalysts Cerdec AG subsidiary for Euro 1.2 billion.
OM Group, Clevela…
US speciality-chemicals concern OM Group Inc. said it has bought German speciality-chemical concern Degussa AG“s Degussa Metals Catalysts Cerdec AG subsidiary for Euro 1.2 billion. OM Group, Cleveland, said it hopes to turn around and sell the electronic materials, performance pigments, glass systems and Cerdec ceramics divisions to a “strategic party.” People familiar with the situation identified the potential buyer as Ferro Corp., a Cleveland producer of coatings, chemicals and plastics. The back-to-back agreement is significant because industry executives had said that buying the entire unit may have been too big a bite for OM Group. OM Group beat out a leveraged-buyout proposal jointly submitted by UK investment group Cinven and Investcorp of Bahrain. OM Group and Degussa were said to have finalized details of the deal at the weekend. A Degussa spokeswoman said on 23 April that Degussa“s management had presented “a possible imminent transaction” to staff representatives at the Degussa Metals unit on 20 April. “This transaction will create significant value for OM Group shareholders,” said James P. Mooney, OM Group“s chairman and CEO. “It is consistent with our philosophy of completing accretive acquisitions and will leverage our existing strengths in metal-separation technology into other specialty chemicals and materials.” The agreement caps the end of an effort by Degussa to reap value from its Degussa Metals unit, which provides precious metals for catalytic converters for automobiles. Degussa, formed earlier this year from the merger of Degussa-Huels and SKW Trostberg, aims to raise around Euro 3 billion from selling noncore activities to focus on the faster-growing market for specialty chemicals. OM Group, through its operating subsidiaries, is a leading international producer and marketer of metal-based specialty chemicals. For the year ended Dec. 31, the company had net income of US$ 71.5 million, or US$ 2.95 a diluted share, on revenue of US$ 887.7 million.