Israel Chemicals To Buy Ripplewood's Supresta

Israel Chemicals has reached an agreement to purchase Supresta, a manufacturer of elemental phosphorus-based flame retardants and other phosphorus-containing products, from private equity firm Ripplewood Holdings. The price is $352 million in cash.

The acquisition, expected to close later this summer, expands Israel Chemicals' position in phosphorus chemicals and builds upon its 2005 purchase of the phosphoric acid and derivatives joint venture Astaris from FMC and Solutia for $255 million.

The Suprestra transaction will add a business with 300 employees and 2006 revenues of $249 million. Israel Chemical's portfolio already includes fertilizers, bromine, magnesium, and industrial products. The Tel Aviv-based firm had 2006 sales of nearly $3 billion.

Israel Chemicals says it will integrate Supresta into its industrial products portfolio to achieve both operational and raw material synergies.

Ripplewood formed Supresta in July 2004 when it acquired Akzo Nobel's elemental phosphorus and derivatives business for $271 million. The firm operates plants in the U.S. and Germany that manufacture flame retardants, plasticizers, functional fluids, and other products.

Supresta's performance was mixed under Ripplewood's supervision. Sales in 2006 were the same as in 2005 and operating profits were $7.5 million, down from $12.6 million in 2005. In the first five months of 2007, operating profits were $4.8 million, up from $2.7 million in the comparable 2006 period.