15 October 2007
Leading specialty chemicals group Perstorp today announced another strategic investment with the acquisition of the Solvay Group’s caprolactone business. With products going into similar applications, the acquisition will boost Perstorp’s product portfolio. Perstorp has also announced its intention to increase significantly Solvay Caprolactones’ capacity to meet growing market demand.
Perstorp, which at the end of September acquired a production unit for Purified Isophthalic Acid (PIA) in Singapore, has now signed an agreement with the chemical and pharmaceutical group Solvay for the acquisition of its caprolactone business, Solvay Caprolactones, which had sales in 2006 of EUR 60 million. Solvay Caprolactones is the market leader in its field and the business is generating substantial and increasing profitability.
The products are used in applications such as support material for top-quality shoes, advanced lacquers for the auto industry and modern orthopedic brace supports. Many applications are showing a very high growth and several new applications are under development. Sales are global and manufacturing takes place in Warrington, England with a workforce of 65.
“We are now beginning to implement our expansion plans with a second acquisition in recent months. Solvay Caprolactones is the market leader in a segment seeing rapid expansion. Almost the same end customers and a similar strategy will provide significant synergies and development potential,” says Bo Dankis, President and CEO of Perstorp. “The production plants also keep high standards and the workforce is extremely professional.”
Perstorp is also announcing its intention to double the capacity for CAPA as well as increasing capacities for downstream derivatives to satisfy the strong increase in demand in all the major applications for the products.
“Perstorp’s aim is a long-term commitment in the caprolactone market. To meet the market’s demand for growth, establishing collaboration with key customers and our intention to develop new application areas, are some of the measures we will introduce to create the world’s biggest caprolactone manufacturing capacity and thereby retain the current leading position,” says Mats Persson, Executive Vice President Business of Perstorp.
Polyols and thermoplastic capacities are also expected to be expanded to utilize the additional monomer generated by the additional capacity and meet the growing market demands.
The acquisition is conditional on the usual authority approval and is expected to be completed before the end of the year. Deutsche Bank acted as exclusive financial advisor to Perstorp in this acquisition.