22nd Dec 2021 09:11
(Alliance News) - Croda International PLC on Wednesday said it has agreed to sell the majority of its Performance Technologies and Industrial Chemicals businesses to Cargill Inc for an enterprise value of EUR915 million on a cash-free, debt-free basis.
The operations being sold represent 77% of PTIC's 2020 revenue and consist of five manufacturing facilities in the UK, China and the Netherlands, employing about 1,000 people. They include a plant in Hull, England and Croda Sipo, a 65% owned joint venture in China. PTIC's revenue in 2020 was GBP470.0 million, within which the sold businesses contributed GBP361 million.
They are being bought by Cargill subsidiary Cargill Velocity Holdings Ltd.
Croda noted that the price of EUR915 million includes 100% of the Sipo joint venture. If the sale of 100% of Sipo can't be achieved, it will be excluded from the deal, reducing the purchase price by EUR140 million.
The disposed businesses are in the process of being separated from the rest of Croda, it said, and the sale is expected to be completed in the summer of 2022.
Yorkshire-based Croda said the disposal of the businesses follows the strategic review that it announced in May.
"The divestment delivers Croda's transition into a focused Life Sciences and Consumer Care company with these two sectors accounting for well over 90% of the group's 2020 adjusted operating profit following completion," Croda said.
Added Chief Executive Steve Foots: "We will focus our capital and resources on delivering sustainable solutions and scaling our consumer, health and crop care technologies, leading to consistent sales growth and an even stronger profit margin."
Croda shares were down 0.9% at 9,888.00 pence early Wednesday in London.
By Tom Waite; [email protected]
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