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Mergers & Acquisitions

Clariant finds a buyer for its pigment unit

The Swiss company is selling the unit to a German competitor, Heubach, and a private equity firm

by Alexander H. Tullo
June 15, 2021 | A version of this story appeared in Volume 99, Issue 23

A photo of a swirl of powdered pigments.
Credit: Clariant
Clariant will retain a 20% stake in its pigments business.

Completing a portfolio restructuring, the Swiss specialty chemical maker Clariant has agreed to sell its pigment business to the US private equity firm SK Capital Partners and a German pigment competitor, Heubach Group, in a deal valued at $900 million.

Heubach is a family-owned firm that has been in the pigment business since 1806. The firm’s roots stretch back to 1350, when the Heubach family started making decorative glassware.

Both Clariant and Heubach have similar lines of organic pigments for applications such as coatings, plastics, and inks. Clariant’s business is much larger, with about $1 billion in annual sales, versus $250 million for Heubach.

“The fit between Heubach and Clariant Pigments is perfect,” Heubach CEO Johann Heubach says in a statement.

Upon completion of the transaction, expected during the first half of 2022, SK will own a stake in the combined firm. Clariant will keep a 20% interest and may be entitled to a $56 million milestone payment based on performance.

SK has racked up similar transactions recently. In December, it purchased a nearly 40% interest in Venator, the former titanium dioxide pigment business of Huntsman. In 2013, SK bought Clariant’s textile chemical, paper specialties, and emulsions business, now called Archroma. SK won’t say whether it plans to combine Heubach with either firm.

Clariant CEO Conrad Keijzer calls the divestiture the “final step” in a repositioning the company launched in July 2018 to focus on care chemicals, catalysts, and oil and mining chemicals. Last year, the firm sold its polymer masterbatch business to PolyOne, now Avient, for $1.4 billion.

The deal is the latest in a spate of specialty chemical divestitures by large firms. Japan’s DIC expects to complete its purchase of BASF’s pigment business later this month. Eastman Chemical recently announced the sale of its tire additives business to One Rock Capital Partners.

In a report released in March, Deloitte noted that 2020 marked the fourth consecutive year of decline in chemical dealmaking. However, the consulting firm predicted a turnaround in 2021 as the economy improves and executives look to realign portfolios. Activity will be particularly strong in specialties, Deloitte said, “driven by attractive growth rates in many of the end-markets.”



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