Evonik has successfully closed the acquisition of the US company PeroxyChem for US$640 million after the responsible court in Washington D.C. dismissed the lawsuit filed by the Federal Trade Commission (FTC) to block the acquisition.
Christian Kullmann, chairman of Evonik’s executive board said, “In its judgment, the court confirmed our view of the H2O2 and PAA market and, above all, the strong specialty focus of PeroxyChem’s portfolio. The acquisition unlocks additional growth opportunities for us, especially in the market for environmentally friendly disinfectants.”
At the end of 2018, Evonik signed an agreement with One Equity Partners to acquire PeroxyChem. The competent antitrust authorities outside the USA had already approved the transaction. However, in August 2019 the FTC filed a lawsuit to prevent closing of the transaction.
Bruce Lerner, CEO of PeroxyChem, is delighted with the outcome of the legal dispute: “Despite the uncertainty, we posted a strong performance in 2019 and reported a further increase in sales and earnings in challenging economic conditions. Combining the two businesses will enable our motivated staff to develop even better solutions for our customers.”
PeroxyChem is a manufacturer of hydrogen peroxide (H2O2) and peracetic acid (PAA) and is well-positioned in high-margin specialty applications.
PeroxyChem successfully started up a wastewater treatment plant using PAA in Memphis in 2019 which is expected to deliver resilient earnings in 2020.
Capital expenditure for the plant was fully spent by PeroxyChem.
As per the contract agreement, the successful and timely implementation of this project increases the purchase price to US$640 million from the originally announced US$625 million.