Switzerland-headed specialty chemical company Clariant AG has announced that it has signed definitive agreements with Germany-headed global chemical major BASF SE to acquire BASF’s attapulgite business assets in the United States (US) for US$60 million in cash, including the signing of a long-term supply agreement for attapulgite-based products to BASF. The acquisition is subject to customary closing conditions and is expected to close in summer 2022.
Attapulgite is a magnesium-aluminum phyllosilicate that occurs in a type of clay soil common to the southeastern United States (US), and the mineral takes its name from the town of Attapulgus, Georgia (GA).
BASF operates its attapulgite mines in this area with the processing facility located approximately 30 km south of Attapulgus in Quincy, Florida (FL). BASF owns the majority of the 18 000 acres in Florida and Georgia supplying the plant with the raw material, and the company’s attapulgite business is one of the largest attapulgite miners and producers in North America.
The business produces attapulgite-based products for a wide range of applications, including purification, and end-markets. BASF’s business is well recognized in the industry for its unique combination of mineral quality, mine reserve size, and strategic location.
Enhance production capacity and position
Clariant is a technology leader in the purification of edible oils and renewable fuels. The transaction will substantially increase the Business Unit’s production capacity in North America, thereby enhancing the ability to participate in the attractive North American market.
Clariant offers unique technology for the purification of biodiesel, which reduces greenhouse gases (GHG) in road transportation, and for the purification of pyrolysis oil, which enables the chemical recycling of plastics.
The renewable fuels market in North America, based on waste streams like used cooking oils (UCO), tall oil, tallow, animal fats, and distillers corn oil, is an attractive growth market.
Adsorbent clays are a crucial enabler for growth as they play a key role in removing contaminants during the pretreatment, thereby protecting the catalyst and enabling a stable and economically viable process.
This acquisition fits very well with our growth strategy to grow through sustainability-focused innovations and bolt-on acquisitions. This acquisition will further nicely extend the footprint of our Functional Minerals business in North America and will further improve Clariant’s position in renewable fuels purification. Clariant is already seen as a sustainability and technology leader today and this acquisition will further improve Clariant’s position in renewable fuel purification, said Conrad Keijzer, CEO of Clariant.
Long-term supply agreement with BASF
Structured as an asset deal with a cash purchase price of US$60 million, the transaction includes the transfer of land, and mining rights, the processing facility, and inventories, which will be integrated into Clariant’s Functional Minerals Business Unit.
The Quincy, FL mining facility employs around 75 employees and manufactures clay-based mineral products used in a variety of industrial applications. BASF’s attapulgite business generated sales of approximately US$36 million in 2020.
BASF acquired the site as part of the Engelhard acquisition in 2006, and it is operated by the Dispersions & Resins division of BASF.
Based on an in-depth review, it was determined that the future of the site and the attapulgite business would be best secured by a divestiture to a company with experience and expertise in mining.
BASF divests the site in Quincy and at the same time enters into a long-term supply agreement for attapulgite with Clariant, that will allow us to continue to support and grow with our customers in the paints, coatings, and construction markets which are core to the success of our business, said Denise Hartmann, SVP of BASF’s Dispersions & Resins business in North America.
Customary closing actions, including merger notification and clearance filings as well as real estate title work, are anticipated to result in a closing of the transaction in summer 2022.
