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LANXESS closes acquisition of Chemours’ clean and disinfect business

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Antitrust authorities approve LANXESS’ first acquisition following realignment

Specialty chemicals company LANXESS closed the acquisition of the Clean and Disinfect business of US-based chemicals company Chemours. LANXESS has paid around EUR 210 million for the clean and disinfect business, which comprises various active ingredients and specialty chemicals especially for disinfection and hygiene solutions. The company has financed this first post-realignment acquisition from existing liquidity.

“The acquisition is the first milestone on our path of growth and a further step toward strengthening our business in North America,” said Matthias Zachert, Chairman of the Board of Management, LANXESS.

The acquisition will be accretive to the company’s earnings per share (EPS) in the first fiscal year. The acquired business is expected to deliver an annual EBITDA contribution of around EUR 20 million, which will be gradually increased by synergy effects to about EUR 30 million by 2020.

The new business is to be integrated into LANXESS’ Material Protection Products business unit, not only expanding its active ingredients portfolio but also extending the value chain in the veterinary disinfection segment through to the end market. The acquired business has three production sites in Memphis and North Kingstown (US) and Sudbury (UK). It achieved 2015 sales of around EUR 100 million, with about half accounted for by the US. The business comprises three product lines: disinfectants, potassium monopersulfate and chlorine dioxide.

The disinfectants are marketed for biosecurity applications in the veterinary segment. The core product brand is Virkon S, the world’s leading powder disinfectant with proven performance against a broad range of viruses, bacteria and fungi. It is used, for example, to combat Foot-and-Mouth disease and Avian Influenza.

The second segment focuses on the production and marketing active ingredient potassium monopersulfate with its core brand Oxone. It is used in pool and spa applications, personal hygiene products and electronics applications and as an active ingredient in the formulation of disinfection products, especially in Virkon branded products.

Thirdly, chlorine dioxide is a proven package solution provider for industrial water treatment applications.

The LANXESS Material Protection Products business unit currently has a workforce of around 350, with production sites in Krefeld-Uerdingen and Dormagen (Germany), Pittsburgh (United States), Jhagadia (India), Changzhou (China) and Singapore. It is part of the Performance Chemicals segment, which posted 2015 sales of around EUR 2.1 billion.

The business unit’s products are used worldwide in many different applications. With its broad portfolio of antimicrobial active ingredients and preservatives, the business unit offers tailored solutions for customers in many industrial sectors. In addition to disinfection, these include the wood protection industry, the paint and coatings industry as well as the construction sector and the beverage industry. Material Protection Products also offers extensive technical service, regulatory support and project-specific research and development.

EP News Bureau

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