KLK buys Dutch chemicals firm

PETALING JAYA: Kuala Lumpur Kepong Bhd (KLK) proposes to acquire Elementis Special Ties Netherlands B.V. (ESN) for an enterprise value of 39 million (RM187.2 million).

KLK told Bursa Malaysia that its wholly owned subsidiary Kolb Distribution AG had on Dec 11 entered into an agreement to acquire from Elementis B.V. its entire interest in ESN comprising 3,404 ordinary shares of nominal value 1,000 each, together with its working capital, assets and business associated with its surfactant chemicals business at ESN’s 1.62ha site at Delden, the Netherlands.

ESN manufactures surfactant and a range of products sold by its specialty products division.

KLK said the Delden site will expand the existing Kolb business portfolio in terms of product range and market coverage.

“The use of the Delden site as another hub for KLK’s market penetration strategy will further accelerate growth in the group’s downstream chemical specialties business in Europe.”

KLK added that ESN comes with a large established customer base and is expected to generate benefits to the group’s chemical business.

“Upon completion of the proposed acquisition, the Delden site will continue to supply a range of specialty chemicals to Elementis Specialties Inc under a long-term supply agreement.”

KLK noted that the proposed acquisition, which is expected to be completed in the first half of 2018, will be funded by a combination of the group’s existing cash reserves and bank borrowings.