LONDON (ICIS)--BASF is to merge its water and paper treatment chemicals operations with Solenis, the former water technologies business of US-based Ashland, to create a business with annual revenues of around €2.4bn, the Germany-headquartered chemicals major said on Thursday.
BASF will hold 49% of the merged company, which combines its paper wet-end and water chemicals businesses with Solenis, but excludes its paper coating chemicals portfolio.
The combined company will retain the Solenis name and be headquartered in Delaware, US.
The remaining 51% of shares in the business will be held by private equity firm Clayton, Dubilier & Rice, which acquired Ashland’s water technologies operations in 2014.
The combined entity will have around 5,000 employees, including 1,300 BASF workers, and includes sites run by the company in the UK, US, Mexico, India and Australia.
BASF’s paper and water chemicals plants at its Ludwigshafen, Germany, verbund site and its complex in Nanjing, China, will not be transferred to the merged unit, and will deliver products and raw materials to the business under supply arrangements.
Solenis and BASF will continue to operate independelty until the close of the transaction, expected before the end of 2018. Financial terms were not disclosed.
“The transaction underlines BASF’s active portfolio management and enables us to share in the future success of this promising joint entity,” said BASF board member with responsibility for performance products Markus Kamieth.
BASF's paper chemicals portfolio includes fixing agents, drainage aids and coagulants for water management, while its water chemicals portfolio includes industrial and municipal water treatment products.
Pictured: A paper mill in Finland
Source: Lehtikuva OY/REX/Shutterstock