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Business

KMG will buy fluid specialist Flowchem

by Alexander H. Tullo
June 27, 2017 | APPEARED IN VOLUME 95, ISSUE 18

Specialty chemical maker KMG is buying Waller, Texas-based Flowchem from the private equity firm Arsenal Capital Partners for $495 million. Flowchem calls itself the world’s second-largest supplier of drag-reducing agents for oil and fuel pipes. Drag-reducing agents are injected into pipes to reduce the friction between the fluid and the pipe walls, increasing throughput and reducing operating pressure. Flowchem isn’t disclosing its revenues, but the firm earned about $43 million before taxes over the past 12 months. KMG makes electronic materials, wood preservatives, and industrial lubricants, including lubricants for valves. KMG says the purchase will allow it to become an instant leader in drag-reducing agents. Arsenal purchased Flowchem in 2013.

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