January 25, 2014

Kemira Oyj sells ChemSolutions' formic acid business to Taminco Corporation 

 

Kemira Oyj has sold its formic acid business, including the feed and the airport runway deicing product lines, to US-based Taminco Corporation, at EUR 140 million (US$191.54 million).

The businesses sold had combined revenue of approximately EUR 140 million (US$191.54 million) in 2012. The transaction includes a manufacturing asset for formic acid in Oulu in Finland. Approximately 160 employees will transfer to Taminco.

Taminco, based in Allentown, Pennsylvania, the United States, is the world's largest integrated producer of alkylamines and alkylamine derivatives. Its products are used by customers in the agriculture, water treatment, personal and home care, animal nutrition and oil and gas end-markets. Taminco currently employ about 850 people and operate in 19 countries with seven production facilities in the United States, Europe and Asia.

"As a leading specialty chemical producer, Taminco is excited to advance its long-term, on-going strategy of expansion into key markets through the addition of high quality, niche businesses.  Our entry into the formic acid space is an opportunity to leverage our existing skill-set to expand into attractive new product lines, as well as achieve numerous synergies that will continue to optimise value for all of our stakeholders," said Laurent Lenoir, Taminco's chief executive officer.

ChemSolutions, while a well-performing and solid business, has no synergies to Kemira's water-related core businesses. After the divestment of the formic acid business, Kemira will become a purely water-focused chemical company based on three segments: Paper, Oil & Mining, and Municipal & Industrial.

Sodium percarbonate, the remaining business within the ChemSolutions segment, will stay within Kemira and will be reported as part of the Paper segment. After the

transaction has closed, the ChemSolutions segment will be discontinued.

"After the successful execution of several non-core divestments in 2013, Kemira's management resources and financing capabilities will be fully focused on growth and profitability improvement in the core businesses," said Wolfgang Büchele, Kemira's president and CEO.

The transaction is subject to the fulfillment of customary closing conditions, and closing is expected in the first quarter in 2014. The agreed transaction price of EUR 140 million will be paid fully at closing. Kemira expects to report a capital gain related to the transaction in the first quarter of 2014.