Kemira Divests Oil and Gas Business to Sterling Specialty Chemicals
In a move to focus on its core businesses, Finnish chemicals company Kemira has signed an agreement to divest its oil and gas-related portfolio for €260 million to Sterling Specialty Chemicals, a US subsidiary of Artek Industries, a global industrial chemicals group based in India.
Kemira and Sterling Specialty Chemicals said they will also enter into a long-term partnership, consisting of contract manufacturing agreements in both directions.
“The divestment of the Oil & Gas business will clarify our focus on sustainability and our strategic priorities: we want to expand in water, build a leading renewables portfolio and digital services business. This move strengthens our capability to look for growth within our water treatment and Pulp & Paper businesses and also to explore new growth opportunities. With Sterling Specialty Chemicals, we have found a committed owner for the Oil & Gas business enabling it to grow further. Our long-term partnership with Sterling Specialty Chemicals will support the transition for our customers,” says Petri Castrén, interim president and CEO at Kemira.
“The acquisition of a high-quality Oil & Gas-related portfolio from Kemira is another step in our global vision and growth strategy of becoming a leading specialty chemicals player,” commented Vishal Goenka, director at Artek.
The revenue to be carved-out from Kemira was around €430 million in 2022. This includes Kemira’s Oil & Gas business, which had a revenue of €373 million in 2022. The remaining carved-out revenue of around €57 million consisted of non-Oil & Gas industrial polymer sales through indirect channels.
Approximately 250 employees are expected to transfer to the buyer as part of the transaction, which includes Kemira’s US manufacturing facilities in Mobile, Columbus and Aberdeen as well as the Teesport manufacturing facility in the UK, the latter being subject to certain site-specific closing conditions being fulfilled. The novel liquid polymer (NLP) manufacturing assets, which are part of Kemira’s manufacturing facility in Botlek, the Netherlands, are included in the deal as well, but Kemira said it will continue to operate the plant under a long-term agreement and will retain the employees.
The transaction, will be carried out as a combination of a share and assets sale, is expected to complete by the end of the first quarter of 2024 but is subject to customary closing conditions and regulatory approvals before completion.
