ALLENTOWN, Pa., Dec. 23, 2013 /PRNewswire/ -- Taminco Corp. (NYSE:TAM), the world's largest producer of alkylamines and alkylamine derivatives, today announced that it has signed a definitive agreement to acquire the formic acid business of Kemira Oyj for a transaction value of approximately EUR 140 (USD 190) million. The formic acid business serves a number of end-markets driven by key global "mega-trends", such as animal nutrition, water treatment and energy. Upon closing, Taminco will acquire a business with EBITDA of approximately EUR 23 (USD 32) million, a manufacturing facility for formic acid and derivatives located in Oulu, Finland, and approximately 160 employees across Finland, the Netherlands, Germany, China, the U.S. and Brazil. The transaction, which has been unanimously approved by the boards of directors of both companies, is expected to close in the first quarter of 2014 and is subject to the fulfillment of customary closing conditions.
Taminco's entry into the formic acid market continues its implementation of a long term strategy of accretive investment in niche businesses with strong outlooks, attractive end-markets, and high levels of similarities with Taminco's core competencies. The transaction, which will be financed through a combination of cash on hand and committed financing, will generate significant value for both Taminco and Kemira, including the agreement by the parties to enter into several long term supply and service agreements following the closing.
"As a leading specialty chemical producer, Taminco is excited to advance its long term, ongoing strategy of expansion into key markets through the addition of high quality, niche businesses. Our entry into the formic acid space is an opportunity to leverage our existing skill-set to expand into attractive new product lines, as well as achieve numerous synergies that will continue to optimize value for all of our stakeholders," said Laurent Lenoir, Taminco's Chief Executive Officer. "We are pleased to welcome a great team of formic acid business employees to Taminco, and look forward to working together to grow Taminco's global leadership position in specialty chemicals."
"The formic acid business is a well performing and solid business – however, with no synergies to Kemira's water related core businesses. After the divestment of the formic acid business, Kemira will become a purely water-focused chemical company based on three segments: Paper, Oil & Mining, and Municipal & Industrial. After the successful execution of several non-core divestitures in 2013, Kemira's management resources and financing capabilities will be fully focused on growth and profitability improvement in the core businesses," said Wolfgang Buchele, Kemira's President and CEO.Legal advisors to Taminco are Kirkland & Ellis LLP, Waselius & Wist and O'Melveny & Myers LLP (with respect to environmental matters). Financial advisor to Kemira is Skandinaviska Enskilda Banken AB and legal advisor is White & Case LLP.