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Celanese, Blackstone to team up on acetate tow
Posted on Monday, 19 June 2017 11:10
Celanese and Blackstone are merging their acetate tow businesses to create a global supplier with pro forma annual revenue of USD 1.30 billion and adjusted earnings before interest, tax, depreciation and amortisation margins (EBITDA) of 40.0 per cent.

The Texas-headquartered speciality materials and chemical manufacturer is handing over its cellulose derivatives operations and its equity interest in existing joint ventures with China National Tobacco, billed as having the largest share of the Chinese market.

Celanese touts this unit as a leading global producer and supplier of acetate tow, acetate flake and acetate film, primarily used in filter products applications such as for cigarettes, with production sites in Belgium, Mexico, the UK and the US.

The group holds a 30.0 per cent interest in three separate ventures in China that produce acetate flake and acetate tow, and has been partnered with state-owned giant China National Tobacco for about three decades.

Its cellulose derivatives comprises the production of acetate flake by processing wood pulp from reforested trees - and is purchased externally from a variety of sources - with acetic acid and acetic anhydride and is then treated further to make acetate tow.

Acetate flake can also be a solvent that is cast to create a film for use in packaging for food and high-end luxury goods, as well as other applications such as anti-fog films.

Meanwhile Blackstone is contributing its Rhodia Acetow unit, which it only just bought from Solvay for an enterprise value of EUR 1.00 billion at the beginning of June.

Celanese will own 70.0 per cent of the new company, which will be headquartered in Amsterdam and have eight wholly-owned manufacturing facilities and three existing joint venture sites, while its private equity partner will have 30.0 per cent.

The two have already received commitments of USD 2.20 billion of mainly non-recourse debt on behalf of their upcoming European-based maker of material used in cigarette filters, which is anticipated to have a debt to EBITDA multiple of 3.5x.

On a pro forma basis, its home region is expected to account for about 49.0 per cent of revenue, followed by Asia (31.0 per cent), Americas (16.0 per cent) and rest of the world (4.0 per cent).

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