MOSCOW (MRC) -- Chemtrade Logistics Income Fund has agreed to sell its potassium chloride (KCl) and vaccine adjuvants businesses to Vertellus for about USD155m, said the Canada-based industrial chemicals company.
Vertellus, a Pritzker Private Capital (“PPC”) company, is acquiring businesses from Chemtrade that produce specialty ingredients essential in the efficacy of medications for hypertension and diabetes, production of next-generation biologics and improving the effectiveness of certain vaccines. The businesses, which had been classified as Assets Held for Sale in Chemtrade’s financial statements, are part of Chemtrade’s Water Solutions and Specialty Chemicals (WSSC) segment and are located in Midlothian, Texas (KCl) and Berkeley Heights, New Jersey (Vaccine Adjuvants).
Scott Rook, President and CEO of Chemtrade, said, “These are both good businesses, which have benefitted from our recent capital investment that expanded and upgraded both plants. As a strategic buyer, Vertellus will be able to add further value and will benefit from the skilled teams at both locations. We are confident that Vertellus and PPC will take the strong platform that we have built and make the businesses even stronger."
Chemtrade will use the net proceeds of the sale to reduce bank debt. Based upon the midpoint of guidance for 2021 provided by Chemtrade in August 2021, and after making a pro-forma adjustment for the loss of a full year’s EBITDA of the disposed businesses, this repayment will reduce Chemtrade’s senior ratio by approximately 0.7 times.
Due to the anticipated timing of the closing of this transaction, the sale will not have a material impact on Chemtrade’s 2021 reported distributable cash after maintenance capital expenditures. These businesses generated approximately USD14.3 million of EBITDA during the twelve months ended June 30, 2021.
Chemtrade’s management and Board of Trustees thank the employees at Midlothian and Berkeley Heights for their dedication and their commitment to operational excellence and wish them well.
As per MRC, Vertellus (Indianapolis, Ind) announced it has acquired Bercen Chemicals, a leading U.S. supplier of alkyl succinic anhydrides and additives used in the fuel, lubricant, and paper industries.
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Headquartered in Indianapolis, The Vertellus group of companies was originally founded in 1857 as a manufacturer of niche specialty products. Today, Vertellus is one of the largest providers of unique specialty chemicals used in diverse applications, processes and market sectors, including personal care, healthcare, food & agriculture, performance coatings, paper additives, infrastructure and industrial specialties.
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