Arkema (Colombes, France) plans to acquire Chinese company Hipro Polymers (Zhangjiagang), a fast-growing producer of bio-sourced polyamide 10.10. The company also intends to acquire Casda Biomaterials (Hebei, China), a global leader in sebacic acid derived from castor oil and used in particular to manufacture this polyamide 10.10.
In anticipation of the rapid development expected over the next few years, Hipro Polymers also plans to triple its production capacity. Current capacity of 5000 tonnes/year will be boosted by Q2 of 2012.
Arkema acquisition target recently announced a major expansion project for bio-derived polyamides: a tripling capacity to 15,000 tonnes/year by quarter two of 2012.
"This acquisition is a great opportunity in many respects. It will help us boost our position in China, one of Arkema's geographic priorities for the last 5 years. With polyamide 10.10, it aptly complements our high added value polyamide 11 and 12 product range, and fits in well with our growth strategy in green chemistry," stated Thierry Le Hénaff, Arkema Chairman and Chief Executive Officer. The Chinese companies reported combined sales estimated at $230 million for 2011, and employ 750 people at two sites in China.
The acquisition price is based on an enterprise value of $365 million for 100% of the capital of both companies, which are predominantly owned by a joint venture between privately owned Chinese specialty chemical company Feixiang Chemicals (Zhangjiagang) and Bain Capital (Boston, MA), a global alternative asset manager with over US$60 billion under management.
By adding Hipro Polymers' PA10.10 to its technical polymer portfolio, Arkema, the world's sole producer of polyamide 11 also derived from castor oil, will strengthen its world leading position in specialty bio-sourced polyamides (15 to 20% expected annual growth rate), becoming the only chemical manufacturer to offer a full range of long chain polyamides 10, 11 and 12. Arkema's acknowledged reputation and application know-how in the end-markets of these various products should help speed up the development of Hipro Polymers, in particular in transportation (automotive, trucks), renewable energies, and electronics.
With the acquisition of Casda Biomaterials, the world's leading producer of sebacic acid, Arkema would benefit from sebacic acid integrated feedstock for the production of PA10.10, and, through this strategic raw material, would be able to supply diversified world markets such plasticizers, as well as the fast-growing bio-sourced and biodegradable copolymer market. The Casda Biomaterials facility is a competitive industrial base located in the city of Hengshui, 250 km from Beijing.
Both investments subject to approval by the Chinese authorities, and the operation should be finalized in early 2012.-[email protected]