Kemira aquires Lanxess Paper Chemicals
Kemira Oyj and Lanxess have reached an agreement on the acquisition of Lanxess' paper chemicals business by Kemira. The net sales of the Lanxess paper chemicals business totalled approx. EUR 240 million in the year 2004. The debt-free price of the business is EUR 88 million. It has been estimated that the deal will raise Kemira's earnings per share from the year 2007 on. It has been estimated also that the deal will dilute Kemira's earnings per share by 5 to10 cents per share in the year 2006 as the business has been loss-making and because of the integration expenditure. After the next three years Kemira expects synergy and cost benefits in the area of EUR 20 million annually arising from the integration of businesses.
The main range of Lanxess products consist of colourants, optical brighteners and sizing. Another large part of the company's net sales arises from toll-manufactured products which are traded for the pulp and paper industry. Lanxess ranks as number three globally in its sales of optical brighteners to the paper industry. Lanxess is the leading supplier of direct anionic dyes and organic pigments to North America.
The agreement is subject to approval by authorities being granted and the other conditions and terms of the contract being met. Kemira's net sales in pulp and paper chemicals will total approx. EUR 1.1 billion, subject to the agreement being finalized.
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