Specialty chemicals company
) has completed the sale of its Consumer Products business to
Toronto, Canada-based KIK Custom Products Inc. ("KIK") on Dec 31,
2013, for an adjusted purchase price of $300 million.
Chemtura sold Lawrenceville, Ga.-based BioLab's pool products
businesses in North America, South Africa and Australia/New
Zealand as well as its European division, known as Bayrol. It
also divested household care business in North America and
manufacturing plants in Conyers, Ga.; Lake Charles, La; and
Atlantis, South Africa.
Chemtura's Board had approved the sale of the Consumer Products
segment in Sep 2013, subject to the completion of definitive
transaction documents. The company also entered into a stock
purchase agreement in Oct 2013 to sell the proposed asset. The
transaction amount was then decided for $315 million, subject to
certain customary pre- and post-closing adjustments.
The $15 million reduction in the adjusted purchase price can be
accounted to certain pre-closing matters resolved by both the
parties. The purchase price is subject to a post-closing
adjustment for working capital and assumed pension liabilities.
Chemtura treated its Consumer products business as a discontinued
operation in its third-quarter 2013 financial statements.
Chemtura will be utilizing the proceeds from the deal for paying
its shareholders and for settling its debt, to maintain the same
leverage ratio as prior to the sale.
With the assets sale now complete, Chemtura can focus on a series
of markets that benefit from global and secular growth trends and
win through its product technologies, operating scale and market
This acquisition is a milestone in the strategic growth of KIK.
Through the integrated businesses KIK is expected to generate
strong free cash flow while offering a diversified portfolio of
household, pool and spa care, and pool specialty products across
KIK is among the largest contract and private label manufacturers
of consumer, institutional and industrial products in North
America. It is a portfolio company of N.Y.-based private equity
firm, CI Capital Partners.
Chemtura, currently, carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the specialty chemicals industry
Minerals Technologies Inc.
HB Fuller Co.
). While Ferro Corp. holds a Zacks Rank #1 (Strong Buy), both
Minerals Technologies and HB Fuller carry a Zacks Rank #2
CHEMTURA CORP (CHMT): Free Stock Analysis
FERRO CORP (FOE): Free Stock Analysis Report
FULLER(HB) CO (FUL): Free Stock Analysis
MINERAL TECH (MTX): Free Stock Analysis
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