Arkema Sells Carbon Business to Calgon
Arkema has agreed to sell its wood-based activated carbon and filter aid business to US-based Calgon Carbon for €145.5 million ($160.1 million). The deal is the latest in Arkema’s portfolio shuffle as it divests businesses with combined sales of €700 million during 2015-2017. Calgon Carbon said the acquisition, its largest to date, adds wood-based activated carbon manufacturing to its leading coal-based activated carbon business.
Describing the Arkema business as a natural fit, Calgon Carbon’s chairman and CEO, Randy Dearth, said: “Importantly, the acquisition would also advance our expansion into stated strategic areas of focus by extending our production capabilities into adjacent filtration media - diatomaceous earth and perlites.”
He added that the business provides a stronger platform to invest in emerging markets in Asia and South America, in particular providing entry to the activated carbon market in India, one of its targeted emerging geographies.
The acquisition also broadens Calgon Carbon’s end-markets to include the pharmaceutical sector as well as allowing it to expand into attractive industry sectors such as food and beverage, and automotive. The acquired business employs around 300 people on six sites in France and Italy and generated EBITDA and revenues of €15.2 million and €93.2 million, respectively, in 2015. Roughly 52% of sales were activated carbon and 48% were filtration media.
Calgon Carbon said it will continue to work on several projects already in progress, including operational improvements and debottlenecking a wood-based activated carbon manufacturing facility. These actions, combined with expected cost savings, are expected to improve the business’s EBITDA by 40% or more by 2019.
The deal, which will be financed with a combination of cash and debt, should be finalized in the fourth quarter of 2016, subject to labor group consultations and regulatory approvals.
Following the sale, Arkema’s filtration and adsorption business will be mostly refocused on molecular sieve, surfactants, oilfield chemicals and phosphorus derivatives.
