Web Date: January 6, 2009
DC Chemical Sells Stake In Columbian Chemicals
Citing deteriorating global financial conditions, South Korea's DC Chemical says it has signed a definitive agreement to sell its 67% stake in carbon black maker Columbian Chemicals. Private equity firm One Equity Partners, which now owns 33% of Columbian Chemicals, will pay $150 million for DC Chemical's stake in a deal expected to close by the end of March.
In 2006, DC Chemical and One Equity bought Columbian from Phelps Dodge International for $600 million, including debt. DC Chemical says it decided to sell its stake to focus on fast-growing core businesses, including polysilicon for solar cells. DC Chemical also says the sale will help it mitigate global risks and reduce debt in a difficult financial environment.
Not counting the debt it undertook to acquire the Columbian stake, DC says it invested $257 million in the carbon black maker. And even though the cash it will receive from One Equity—an affiliate of JPMorgan Chase—is less than its original investment, the firm calls the transaction "timely and prudent" given current economic conditions.
Based in Marietta, Ga., Columbian operates 12 facilities in the Americas, Europe, and Asia, employing 1,300 people. The carbon black it makes is used to enhance the strength and durability of rubber tires and as a pigment in plastics and printing inks.
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