CHEMICAL TECHNOLOGY

Clariant Completes its Divestment Program by Agreeing to Divest its Pigments Business

Clariant, SK Capital, Heubach Group | June 15, 2021

Clariant Completes its Divestment Program by Agreeing to Divest its Pigments Business
Clariant, a focused, sustainable, and innovative specialty chemical company, announced today that it had reached definitive agreements for the sale of its Pigments business to a consortium led by Heubach Group and SK Capital Partners for an Enterprise Value (EV) ranging from CHF 805 million to CHF 855 million on a cash and debt-free basis, subject to a CHF 50 million earn-out payment contingent on the This is a multiple of 10.7 to 11.4 times the standalone adjusted 12-month EBITDA as of April 2021. (LTM).

Clariant will reinvest to become a 20% shareholder in the eventual holding company with Heubach and SK Capital after the transaction's close. The merged company will be a global pigments player with over 3 000 employees, annual sales of more than EUR 900 million, and vital service and manufacturing capabilities across the world. In addition, the reinvestment enables Clariant to benefit further from the Pigments business's improved profitability due to the initiated efficiency program and to share in future growth opportunities and synergies from the merger with the Heubach Pigments firm.

The transaction is scheduled to close in the first half of 2022, subject to usual closing conditions and regulatory clearances. This deal excludes Clariant's Pigments business's share of the participation in Infraserv Höchst, Germany.

Clariant will have completed its planned divestitures as part of its portfolio upgrade, having already disposed of the Healthcare Packaging and Masterbatches businesses. Clariant's transformation into a high-value specialty chemical firm with above-market growth, improved profitability, and better cash flow is complete with the Pigments sale. The proceeds from the Pigments divestment will be used to invest in growth projects within the core Business Areas, execute the sustainability and innovation strategy, fund performance improvement programs, strengthen Clariant's balance sheet, and fund reinvestment in the Clariant-Heubach combined Pigment business.

Clariant's Pigments business is a world leader in producing high-quality organic pigments, pigment preparations, and dyes used in various applications, including the automobile sector, industrial and architectural coatings, and the plastics industry. On a standalone adjusted basis, the unit's 1,900 employees generated around CHF 850 million in 2020.

About Clariant
Clariant's Pigments business is a world leader in producing high-quality organic pigments, pigment preparations, and dyes used in various applications, including the automobile sector, industrial and architectural coatings, and the plastics industry. On a standalone basis, the unit's 1,900 employees generated around CHF 850 million in 2020.

About Heubach Group
As one of the original pigment manufacturers, Heubach has over 200 years of experience in the industry. Heubach is a significant global producer of organic, inorganic, and anticorrosive pigments and pigment preparations, with headquarters in Langelsheim, Germany, and facilities in Germany, the United States, and India as sales offices worldwide.

About SK Capital
SK Capital is a private investment firm focused on the specialized materials, chemicals, and pharmaceutical industries. SK Capital's business portfolio generates approximately $11 billion in annual revenue, employs over 16,000 people worldwide, and runs 150 plants in 28 countries. The business presently manages assets worth more than USD 5 billion.

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PRODUCTS AND TECHNOLOGIES

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KBR, Inc. | January 18, 2022

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CHEMICAL TECHNOLOGY

Eastman to invest up to $1 billion to accelerate circular economy through building world's largest molecular plastics recycling facility in France

Eastman | January 17, 2022

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CHEMICAL MANAGEMENT

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Spotlight

Chemicals are bad, right? Otherwise why would so many purveyors of all things healthy proudly proclaim their products to be "chemical-free" and why would phrases such as "it's chock full of chemicals" be so commonly used to imply something is unnatural and therefore inherently dangerous?

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