Cabot To Acquire Norit

Cabot Corp. has agreed to acquire Norit, the world’s largest producer of activated carbon, for $1.1 billion. The sellers are European private equity firms Doughty Hanson and Euroland Investments. The sale will supplant Norit’s plan for an initial public offering (IPO) of stock, which it had filed for in March. Based in the Netherlands, Norit had sales last year of $360 million and has grown 12% annually since 2007. Its IPO filing says it expects continued growth because of the use of activated carbon as a mercury removal agent for coal-fired power plants. Cabot CEO Patrick M. Prevost says the acquisition supports his company’s effort to shift its portfolio to higher margin, less cyclical specialty chemicals. Cabot is one of the world’s largest producers of the rubber abrasive carbon black, much of which is sold at low margins to tire producers. Activated carbon is produced by treating carbon sources with heat, steam, and chemicals to create particles of high internal porosity. Carbon black is produced by the incomplete combustion of carbon sources.