Cognis strengthens coatings and synlubes business by strategic acquisition from Degussa
Cognis has signed a contract to acquire Laporte Performance chemicals, a subsidiary of the former Laporte plc, which belongs to Degussa AG. This includes two production and development sites in the UK as well as several distribution companies. A total workforce of 220 are employed at the company, which generated sales totaling GBP 64 million (approx. EUR 95 million) in 2001. By selling the facilities, Degussa follows the European Commission's competition requirements. The contract was signed subject to the approval of the anti-trust authorities.
Antonio Trius, Cognis' Chief Executive Officer (CEO), commented: "For Cognis this acquisition is a strategic success. Laporte Performance Chemicals provides an optimum enhancement to our product portfolio in the Functional Products business unit. One of the decisive factors for the acquisition was that Cognis will be able to strengthen its approach of ecologically sustainable chemicals as well as enter newly emerging markets." In the UK, Laporte Performance Chemicals manufactures components for environmentally friendly paint systems, i.e. high-performance automotive paints (hydroxy monomers), as well as synthetic lubricants (polyalkylene glycols). In addition, the company manufactures multifunctional monomers based on acrylates for coatings as well as rubber chemicals and plastic additives based on esters. Laporte maintains a strong position with its products. This acquisition, which includes not only production, but also all company divisions including Sales and Development, clearly strengthens Cognis' commitment in the UK market.
Steve Catchpole, General Manager of Laporte Performance Chemicals, sees advantages for both sides from this acquisition: "On the one hand, our portfolio is very complementary to that of Cognis and we bring in our experience in the acrylate chemistry industry, and on the other hand we are benefiting from the global positioning of the Cognis Group and its ability to offer its customers complete solutions. That is the basis for establishing mutual and long-term success."
Cognis has based its corporate strategy and its product portfolio on the two trends of "wellness" and "sustainability". With its Care Chemicals and Nutrition & Health business units, Cognis is extremely well prepared for the future market for "wellness" products. In the Functional Products business unit as well as in the Process Chemicals business, Cognis is embracing the global trend towards sustainable products and concepts. The Functional Products business unit includes components for polymers, coatings and inks; lubricant specialties; adjuvants for agrochemicals and fermentation specialties as well as mining chemicals. The acquisition will enable Cognis to expand and supplement this product range and to offer its customers even more complete solutions.
Cognis is financing the acquisition without raising any additional debt. In doing so the company is once again confirming its growth strategy and underlining its objective of going public in four to five years. During this time, the company intends to grow both organically and by means of further acquisitions.
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