Please wait.'

Page is loading'


Home  > Markets & companies  > Raw materials market  > Kraton agrees to acquire Arizona Chemical

Tuesday, 24 September 2019
pdf
Markets & companies, Raw materials market

Kraton agrees to acquire Arizona Chemical

Tuesday, 6 October 2015

Kraton Performance Polymers, Inc. has entered into a definitive agreement to acquire all of the capital stock of privately held Arizona Chemical Holdings Corporation for a cash purchase price of EUR1.22 billion.

Headquartered in Houston, Texas, Kraton is a global producer of engineered polymers and one of the world's largest producers of styrenic block copolymers (SBCs). Source: Slawodomir Podskrob/pixelio.de
Headquartered in Houston, Texas, Kraton is a global producer of engineered polymers and one of the world's largest producers of styrenic block copo...

Arizona Chemical is a leading global producer of high-value performance products and specialty chemicals derived from non-hydrocarbon, renewable raw materials. Arizona Chemical's end use market exposure is highly complementary with that of Kraton, particularly in markets such as adhesives, roads and construction, coatings and oilfield chemicals.

Extending technology diversification

"This transformational acquisition will extend Kraton's technology and market diversification, while substantially increasing profitability and free cash flow, creating a more robust platform for growth and value creation for our stockholders," said Kevin M. Fogarty, Kraton's President and Chief Executive Officer. "Our stockholders will benefit from identified pre-tax synergies of EUR57.97 million, which we expect to achieve by 2018. Arizona Chemical has a stable and attractive margin profile, with adjusted EBITDA margins in excess of 20% over the past five years and an attractive cash flow profile. On a combined basis we expect to generate free cash-flow of more than EUR401.33 million over the first three years of combined operations, which will be available for debt reduction and allocation to stockholders."

"Kraton and Arizona Chemical are both well-respected, leading providers of high quality products and innovations in their respective specialty markets," said Dan F. Smith, Chairman of Kraton's Board of Directors.  "The fact that Kraton and Arizona Chemical have such a highly complementary market focus, coupled with a shared business philosophy fundamentally premised on product differentiation and portfolio shift to drive improved profitability, is what makes this such a compelling combination," added Smith.

"Over the past year we have spoken at length to our employees, our innovation partners, and our stockholders about our three-part strategy. The acquisition of Arizona Chemical is consistent with our stated strategy, and it creates new opportunities to deepen our customer relationships by expanding Kraton's presence in our core markets, where more than 50% of Arizona Chemical's sales are directed," said Fogarty. "In addition, given the renewable nature of Arizona Chemical's product and technology offerings, the complementary growth we foresee can be accomplished while reducing our overall exposure to hydrocarbon-based feedstocks," Fogarty added.

top of page
Comments (0)
Add Comment

Post comment

You are not logged in

register