A $2.69 billion deal between two specialty chemical companies is moving forward after shareholders of the business that's being acquired gave the merger the green light.
German specialty chemicals group Lanxess AG plans to acquire U.S.-based Chemtura Corp., which is based in Philadelphia. Chemtura shareholders approved the merger a special meeting Feb. 1, Lanxess announced in a press release.
In a move to expand its footprint in North America and make it a major player in additives, Lanxess is acquiring Chemtura.
"We are pleased that our stockholders recognize the immediate and substantial value of this compelling transaction,” said Craig A. Rogerson, president and CEO of Chemtura and chairman of its board of directors.
Major Player Strategy
Lanxess (Cologne) says the transaction, first announced in September 2016, will make it a major player in the field of additives chemistry and increase the company’s footprint in North America.
“Additives is a very attractive business field in specialty chemicals,” said Anno Borkowsky, head of the Lanxess business unit Rhein Chemie Additives. “In addition to their relatively low capital intensity, they require strong expertise and enable customized solutions. In this area, both Chemtura and Lanxess have long-standing expertise.”
The companies expect the deal will close in mid-2017, after remaining regulatory approvals are obtained.
Clearance for the acquisition from the U.S. antitrust authorities was received at the end of December 2016.
Forming a New Unit
Chemtura has 20 sites in 11 countries and approximately 2,500 employees worldwide. The company posted sales of $1.7 billion in 2015.
Flame retardant and lubricant additives are “the main pillars of Chemtura’s business and would complement the current Lanxess portfolio,” Lanxess officials say. After closing of the transaction, these two business activities will be integrated with Lanxess’ Rhein Chemie Additives business unit to form a new segment.
Rhein Chemie Additives supplies a broad range of special additives and service products for the manufacture of plastics, rubber, lubricants and coatings. It employs some 1,600 people at more than 20 sites around the world.
In addition to the additives, Chemtura’s portfolio also includes urethanes and organometallics, which will be integrated into Lanxess’ portfolio as well.
Lanxess employs 16,700 workers in 29 countries. The company had sales of EUR 7.9 billion ($8.4 billion USD) in 2015.