Synthos among eight interested in Polish silicates maker Rudniki

27 March 2013 12:43  [Source: ICIS news]

LONDON (ICIS)--Eight companies, including Poland's major synthetic rubber producer, Synthos, have expressed an interest in bidding for silicates manufacturer Zaklady Chemiczne Rudniki, Poland's treasury ministry said on Wednesday.

The ministry has relaunched the privatisation process for its 85% stake in Rudniki after its initial attempt at selling the holding, which ran for more than a year until last August, ended in failure.

One of the bidders that was given the opportunity for exclusive negotiations over the stake during the first privatisation attempt, German silicates and specialty chemicals maker Woellner Group, is among the eight companies expressing an interest in buying control of Rudniki this time around.

Apart from Synthos and Woellner, the ministry named another four Polish companies – the Zaklady Chemiczne Alwernia subsidiary of the Ciech chemical group, Probud, Sepo and RE Alloys – and the Czech Republic's CHS Resins and Tonaso Holding as parties interested in bidding.

Obstacles to the sale of the company, in Rudniki Kolo Czestochowy, southern Poland, have included currency market losses and substantial waste liquidation costs, a ministry source said.

In a note to investors on the potential value to Synthos in taking a majority stake in Rudniki, investment bank WOOD & Company said: “While Rudniki’s wider product range seems to have little in common with Synthos, at first glance, silica-based products are one of the minor components in the rubber industry.

“Given the volatility of Rudniki’s earnings over the 2009-11 period and the lack of information regarding the 2012 results, pricing the asset is quite difficult. Based on the available data, we would expect a valuation in the range of zloty (Zl) 20-70m, rendering the acquisition quite small in the context of Synthos’s business.”

The production portfolio of Rudniki includes sodium silicate, sodium water glass, potassium silicate, potassium silicate glass and industrial washing agents.

The company's products are largely used in the detergent, paper, rubber, building materials and ceramic/glass industries.

In 2011, Rudniki, which has a workforce of 173, saw a net loss of Zl 3.3m ($1.0m, €0.8m) and generated sales revenue of Zl 97.4m, the ministry said. Its 2011 earnings before interest, tax, depreciation and amortisation (EBITDA) was Zl 16.2m, it added.

Rudniki is operating at about 75-80% of its capacity, the ministry said.

($1 = €0.78, $1 = Zl 3.25, €1 = Zl 4.18)


By: Will Conroy
+44 20 8652 3214



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