Rhodia completes acquisition of China chemicals business
The deal was given the go ahead by the Chinese regulation authorities this week, which means that the transaction can now be completed, making Rhodia the owner of the Zhangjiagang-based business and its 650 employers.
Rhodia says the acquisition will allow it to integrated its specialty amines technologies, key intermediaries of surfactants, into its Novecare business portfolio, which is targeted at the cosmetics and personal care industry.
In a joint statement, the two companies said that the combination of Rhodia’s research and development and formulation capabilities, combined with Feixiang’s expertise in the area of amines would serve to reinforce Rhodia’s expertise in the surfactants area.
Expanding Rhodia's footprint in Asia
The integration of the business into Rhodia’s portfolio makes it the largest international surfactant player in Asia, while also boosting its sales in the region by around one third.
The acquisition price is based on an enterprise value of $489m (€397m) for 100 percent of Feixiang Chemicals (approximately nine times the EBITDA value), said Rhodia, although the current majority owner will hold 12.5 percent of the capital for the next two years.
Rhodia has been making a concerted effort to increase its business in the area of specialty surfactants in recent years, in an attempt to make it the dominant player in this segment worldwide.
Specialty surfactants worldwide
Back in 2009, Rhodia purchased the global surfactants manufacturer McIntyre Group and with it inherited two facilities producing speciality surfactants, one in Halifax, UK and one in University Park in Illinois in the US, complementing its existing plant in Leeds, UK.
As part of the post-acquisition consolidation of the two businesses, Rhodia has announced it will be transferring its speciality surfactant operations from its plant in Leeds to the newly-acquired Halifax site, as well as investing further at both Halifax and University Park in the future.
Transfer of the production is set to start in the third quarter of 2010 and be completed by the end of the first half of 2011.
Speciality surfactants can be used in products such as shampoos, conditioners and shower gels to bring benefits such as mildness and moisturization to formulations based on commodity surfactants.