27-Sep-2016 - LANXESS AG

LANXESS announces plan to acquire Chemtura

Expected annual synergies of EUR 100 million by 2020

LANXESS (FRA: LXS) reaches the next milestone on its growth path: The specialty chemicals company announced plans to acquire US-based Chemtura Corporation (NYSE: CHMT), one of the major global providers of high-quality flame retardant and lubricant additives. With the largest acquisition in its history, LANXESS is building on its own additives portfolio and will become one of the world’s major actors in this growing market.

Headquartered in Philadelphia, Pennsylvania, Chemtura has 20 sites in 11 countries and approximately 2,500 employees worldwide. The company reported sales of around EUR 1.5 billion in the last four quarters with EBITDA pre exceptionals of approximately EUR 245 million (EBITDA margin of approx. 16%). Approximately 45% of Chemtura’s revenue is generated in North America. In addition to additives, Chemtura’s portfolio includes urethanes and organometallics.

“With this acquisition, we are forming a champion in the field of additives and are strengthening our already profitable portfolio,” said Matthias Zachert, Chairman of the Board of Management of LANXESS AG. “Through the acquisition, we are further implementing our strategy to become a more resilient and profitable chemical company. We are significantly building on our competitive positioning in medium-sized markets and increasing our presence in North America. LANXESS is taking a next and major step forward on its growth path.

LANXESS strengthens profitable business with flame retardant and lubricant additives

Chemtura’s two additive segments form the main pillars of the company’s business. Both will, together with LANXESS’ Rhein Chemie Additives business unit (ADD), form the new Performance Additives segment after the closing of the transaction. ADD already offers a wide range of specialty additives and service products for the plastics, rubber, lubricants and colorants production, and employs around 1,600 employees worldwide at more than 20 locations.

The first pillar of Chemtura’s additives business includes lubricant additives and synthetic lubricants for industrial applications, such as in power generation and aviation. LANXESS expects the industrial lubricant additives market to grow at an annual rate of three to four percent in the medium term, primarily driven by steadily increasing requirements with respect to the performance and environmental sustainability of lubricants.

The second pillar is mainly comprised of the brominated flame retardant additives, elemental bromine and further bromine derivatives businesses. Chemtura is a major supplier of bromine and brominated products and is well positioned due to its backward integration. LANXESS also expects medium-term growth rates of three to four percent per year in the field of flame-retardant additives.

New business fields for LANXESS: Urethane and Organometallics

Chemtura’s urethane business is a major provider for hot-cast prepolymers and for special, aqueous urethane dispersions and polyester polyols. These are components for special polyurethanes, which are used mainly in the construction, mining, oil/gas, sports and electronics industries. The urethanes business will be integrated into LANXESS’ High Performance Materials segment, in which the high-tech plastics business is anchored.

Chemtura is counted among the major companies worldwide in organometallics.

Facts, background information, dossiers
More about Lanxess
  • News

    LANXESS robust in first quarter of 2020 despite coronavirus crisis

    Specialty chemicals company LANXESS proved robust in the first quarter of the year – despite the weak economic environment due to the coronavirus pandemic. Earnings in the new Consumer Protection segment and in the Specialty Additives segment developed positively, significantly mitigating t ... more

    LANXESS completes sale of its Currenta stake

    Specialty chemicals company LANXESS April 30, 2020 completed the sale of its 40 percent stake in chemical park operator Currenta to Macquarie Infrastructure and Real Assets (MIRA). Both companies had reached an agreement to this effect in August 2019. LANXESS realized an equity value of EUR ... more

    Marcel Beermann to head LANXESS’ Global Procurement and Logistics group function

    Marcel Beermann (47) will take over as head of the Procurement and Logistics group function at specialty chemicals company LANXESS on June 1, 2020. He succeeds Frederique van Baarle (48), who will become head of the High Performance Materials business unit on the same date. Beermann is curr ... more

  • Companies

    LANXESS Deutschland GmbH

    LANXESS is a leading specialty chemicals company and operates in all important markets of the world. Its core business comprises the development, manufacture and sale of high-tech plastics, high-performance rubber, specialty chemicals and intermediates. In addition, it helps its customers i ... more

    LANXESS Sybron Chemicals Inc.

    LANXESS Sybron Chemicals Inc., provides world-class ion exchange resins to meet the needs of numerous applications. The global strength of Lewatit ion exchange resins in industrial water and chemical processing markets is joined with the solid position Ionac ion exchange resins enjoy in the ... more

    LANXESS S.A.

    LANXESS is listed as the fourth largest German Chemistry Corporation in the Frankfurt Stock Exchange. With our extensive portfolio we are active in all the markets of the world. Our product pallet ranges from base, specialty and fine chemicals to plastics and rubbers. In addition, we sup ... more