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ASK Chemicals may be axed by Rhone: Reuters
Posted on Thursday, 25 April 2019 13:23
Private equity firm Rhone Capital is considering a disposal of its German chemical maker ASK Chemicals in a deal that could fetch upwards of EUR 500.00 million, people familiar with the matter told Reuters.
According to the sources, the buyout group is working with Citi on the deal, which could attract peers such as Vesuvius, Imerys, RHI and Huettenes-Albertus, as well as other investors.
Initial packages, the insiders noted, are expected to be sent out next month.
Billed as one of the largest suppliers of complete and tailor-made services for the foundry industry, ASK Chemicals supplies binders, additives, feeders, filters and metallurgical products.
The company is expected to post earnings before interest, taxes, depreciation and amortisation of around EUR 65.00 million this year and is likely to be valued at between 7.0 and 8.0x that based on past deals in the sector, the people said.
One source observed that ASK Chemicals is very focused on the foundries sector, typically supplying the auto industry, and it may be looking to increase its presence in this area.
Rhone paid USD 350.00 million for the group back in 2014 from former owners Clariant and Ashland.
Zephyr, the M&A database published by Bureau van Dijk, shows there have been 1,042 deals targeting the chemical manufacturing sector announced worldwide since the start of 2019.
The largest of these involves Bristol-Myers Squibb agreeing to acquire biopharmaceuticals company Celgene for USD 74.00 billion.
It was closely followed by Saudi Arabian Oil Company agreeing a SAR 259.133 billion (USD 69.08 billion) purchase of a 70.0 per cent stake in Saudi Basic Industries.
Versum Materials, AstraZeneca, Evonik Industries’ methacrylates business and DuluxGroup, among others, have also been involved in deals worth more than the equivalent of USD 3.00 billion in 2019 to date.
© Zephus Ltd