Malaysia-headed PETRONAS Chemicals Group Berhad (PCG) has announced that it signed a Securities Purchase Agreement on May 14, 2022, to acquire the entire equity interest in Sweden-headed global specialty chemicals major Perstorp Holding AB, with Financière Forêt S.à.r.l, a company under PAI Partners, a European private equity firm.
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The acquisition, which is subject to relevant regulatory and shareholders’ approvals, values Perstorp Group at an enterprise value of EUR 2.3 billion.
We are excited about becoming part of the PETRONAS family. I see a strong commonality in values and priorities for how to take our respective businesses forward, meeting the challenges and opportunities in the future, said Jan Secher, President and CEO of Perstorp.
PCG’s journey to achieve its vision of becoming the preferred chemical company providing innovative customer solutions is based on a clear strategy; to strengthen its basic petrochemicals portfolio, and selectively diversify into derivatives, specialty chemicals, and solutions.
Outstanding fit
In the execution of this strategy, this acquisition marks the creation of a significant specialty chemicals portfolio, while enhancing PCG’s overall earnings.
This landmark acquisition is a major milestone for PCG in establishing a key platform to diversify into the specialty chemical industry and capture new growth opportunities, whilst enabling us to future proof our business against market cyclicality and volatility, said PCG Managing Director/CEO, Ir. Mohd Yusri Mohamed Yusof
This follows the acquisition of BRB Group in 2019, a leading global independent producer and formulator of silicones, lube oil additives, and chemicals, which launched PCG into new areas aligned with its long-term growth ambitions.
Perstorp is an outstanding strategic fit for PCG and enables us to participate in attractive end-markets such as paints & coatings, construction, automotive, personal care, and animal nutrition that share a robust growth outlook. This acquisition will also provide us with critical talent, know-how, technological platforms, and proven customer channels to address the pressing needs of the market for more sustainable solutions, Ir. Mohd Yusri Mohamed Yusof said.
Leading niche specialty chemicals player
Established more than 140 years ago, Perstorp is a leading niche specialty chemicals player that develops sustainable solutions with a focus on the Resins & Coatings, Engineered Fluids, and Animal Nutrition markets.
With seven state-of-the-art manufacturing sites and three research and development (R&D) centres worldwide, Perstorp has a presence in 26 countries including the US, Europe, and the Asia Pacific.
It has approximately 1 500 employees and serves more than 2 600 customers globally with its 130 product offerings within 30 product groups. It has a global #1 position in several products such as Trimethylolpropane (TMP) and Pentaerythritol (Penta).
We find Perstorp attractive for its expansive range of products, established customer base as well as market leadership in selected chemicals, which are complementary to PCG, Ir. Mohd Yusri said.
Perstorp is highly regarded among its customers for its product quality and customization, supply reliability, customer centricity, and sustainable products and is recognized for its proprietary oxo and polyol chemistries.
In FY2021, Perstorp recorded approximately EUR 1.334 billion in revenue and EUR 248 million in EBITDA with an EBITDA margin of 18.6 percent.
Perstorp will add up to 2.3 million metric tonnes per annum to PCG’s production capacity and immediately contribute about 28 percent incremental revenue to PCG based on 2021 results as well as support PCG’s medium-term goal of establishing 30 percent revenue generated from non-traditional businesses by 2030, said Ir. Mohd Yusri.
He added that this acquisition would also contribute to strengthening Malaysia’s specialty chemicals industry, benefitting the economy in the long run.
We are excited to welcome Perstorp and its exceptional team into PCG family, Ir. Mohd Yusri, said.
Perstorp has an industry-leading sustainability strategy and is well-known. Its Pro-Environment products and solutions are used by and required for the sustainable transformation of many industries and end products.
By tapping into the PETRONAS strong global brand and PCG’s strength as a reputable industry and market leader in the Asia Pacific region, we are confident that Perstorp can continue to expand into its next phase of growth, said Jan Secher.
Through this strategy, Perstorp has developed a number of solutions such as the game-changing production of sustainable methanol from carbon dioxide (CO2), residue streams, biogas, and green hydrogen at its Stenungsund site in Sweden to replace a large portion of its fossil-based methanol feedstock by 2026.
With Perstorp’s holistic and innovative approach to reducing environmental impact in line with PCG’s aim for positive environmental and social contributions, we are confident that together we can accelerate our sustainability journey towards a circular economy and carbon neutrality by 2050, concluded Ir. Mohd Yusri.
