Westlake Chemical Corporation has made a binding offer to acquire Nakan, a global compounding solutions business, from Los Angeles-based private equity firm, OpenGate Capital. The Reims, France-based concern is a compounder of PVC, TPE and TPO compounds for automotive, healthcare/medical, packaging, consumer goods, building & construction.
|Westlake acquisition target Nakan is active in the automotive field.|
Nakan operates eight production facilities, located in China, France, Germany, Italy, Japan, Mexico, Spain and Vietnam, as well as a research facility in France and application laboratory in the United States.
Nakan generated approximately $300 million of revenue in the most recent twelve-month period. Under the terms of Westlake’s offer, which is subject to exclusivity protection, Westlake will pay approximately $265 million in cash, subject to adjustment. The binding offer was made in order to permit Nakan to proceed with its consultation obligations with French works councils prior to entering into a negotiated, mutually binding purchase agreement.
“The combination of Nakan with Westlake’s existing compounding business will present an excellent strategic fit. It will allow us to expand our compounding business globally and add important specialty products and technology to our existing portfolio,” said Albert Chao, Westlake’s President and Chief Executive Officer. “Nakan is an impressive business with an outstanding reputation for meeting customer needs with superior technology, product quality, and operating excellence. We look forward to working with their talented team once they join the Westlake family of companies.”
The transaction is expected to close by early 2019, subject to receipt of regulatory approvals, completion of required employee consultation procedures and other customary closing conditions.
Recent developments at Nakan include a rigid PVC without any plasticizer for filament extrusion used for 3D printing. The grade was developed jointly by Nakan’s German subsidiary Resitech Germany GmbH and Fillamentum Industrial. The tailor-made formulation especially adapted to the industrial 3D printing process, has excellent chemical resistance, flame retardant properties and high impact modification.