Arsenal Capital adding value to speciaty chem acquisitions

19 October 2005 16:34  [Source: ICIS news]

NEW YORK (ICIS news)--Private equity firm Arsenal Capital Partners, which has been acquiring specialty chemical firms, and eventually could combine some of them into a company that it would take public.

 

“We have identified specialty chemicals as an area where there are opportunities yet to be realised,” said Arsenal managing director and co-founder Barry Siadat. “This used to be a pretty attractive industry, but over the last few years, some companies have taken resources away from what made specialties great. We really think the fundamentals can be righted by focusing back into sales, marketing, applications development and technology.”

 

Arsenal has bought Reilly Industries ($360m or Euro292m) in sales) for about $250m and Velsicol, a specialty chemical company with about $220m in sales. Both make non-phthalate polymer additives and agricultural chemicals, as well as other specialty products.

 

Unlike the typical financial buyer, Arsenal Capital seeks to grow its businesses by bringing in resources rather than relying on cost cutting to maximize cash flow.

 

“What has gotten many specialty companies in trouble in the first place was that they cut so much costs that they cut some muscle away with the fat,” Siadat said.

 

(The full story will be published 24 October in Chemical Market Reporter.)


By: Joseph Chang
+1 713 525 2653



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