23 December 2009 19:07 [Source: ICIS news]
TORONTO (ICIS news)--Chemtura has agreed to sell its polyvinyl chloride (PVC) additives business to private equity firm SK Capital Partners through a “stalking horse” asset and purchase agreement, the US-based international specialty chemicals producer said on Wednesday.
The sale, which is subject to the completion of an auction process and court approval, includes certain assets, the stock of a European subsidiary and the assumption of certain liabilities, the company said. The stalking-horse bid is worth at least $36m (€25m) and potentially $47m - the bulk from legacy liabilities, according to a court filing.
"We believe that the proposed transaction is the most certain way to maximise the value of the PVC additives business and is in the best interests of the company and all of our stakeholders,” said Chemtura chief executive Craig Rogerson.
The $36m value was from the judgement of Chemtura debtors, while SK Capital viewed it as closer to $47m.
A stalking-horse bid is a binding offer made for a bankrupt company’s assets, but it is subject to a higher bid being made through the auction process. The deadline for other bids is 9 February, and if they are received, the auction would be held on 22 February, according to the filing.
Chemtura filed for US Chapter 11 bankruptcy protection on 18 March.
The PVC additives business had revenues of $374m (€262m) in 2008 and $177m for the nine months ended on 30 September, Chemtura said. The business has a strong, global manufacturing footprint with plants in North America and Europe, as well tolling agreements in the EU and ?xml:namespace>
Last week, Rogerson told ICIS news that asset sales would not be necessary for Chemtura’s reorganisation, but at the time would not comment on whether any asset sales were ongoing.
Chemtura said earlier it was making significant progress in reorganising its business and aimed to come out of US bankruptcy protection by mid-2010.
SK Capital is described as a
Additional reporting by Ben DuBose
($1 = €0.70)
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