Bayer sells HC Starck to private equity for €1.2bn

23 November 2006 15:13  [Source: ICIS news]

H C Starck sold to private equityLONDON (ICIS news)--Bayer said on Thursday it would sell its metals and powders company H C Starck to Advent International and the Carlyle Group for €1.2bn ($1.6bn).

The financial investors said they aimed for an initial public offering for the Goslar, Germany, producer within three to five years.

Advent and Carlyle will pay €700m in cash for H C Starck and assume personnel-related and financial liabilities of some €450m.

Bayer said the divestment would cut its net debt by about €1bn and lead to an accounting gain of €150m. Closing was expected at the beginning of 2007.

 “It [H C Starck] not only holds leadership positions in its markets, but also has enormous growth potential in existing and prospective new business areas,” said Advent International’s general manager in Frankfurt, Ralf Huep.

H C Starck makes metal and ceramic powders, specialty chemicals and components made from advanced materials and refractory powders.

It had sales in 2005 of €920m.

Bayer had held an auction for H C Starck in which buyers were able to examine the company in detail and submit a binding offer. The process had attracted both strategic and financial investors, it said.

In March the drugs to chemicals group said it aimed to agree the sale of H C Starck and the cellulosics producer Wolff Walsrode, both part of Bayer MaterialScience, in 2006 to partly finance its €17bn acquisition of compatriot drugs maker Schering. 

German press reports in September named Akzo Nobel, Dow Chemical, Shin-Etsu, JM Huber and Hercules as parties interested in Wolff Walsrode but suggested that private equity was not in the race. Wolff Walsrode had 2005 sales of €329m.

By: Nigel Davis
+44 20 8652 3214

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