- Rhone Capital is currently working alongside Citi on the proposed deal.
- The deal may value the Germany-based supplier at approximately €500 million.
ASK Chemicals, the foundry industry’s largest supplier of complete solutions & consultation services, has reportedly been enlisted for sale by its New York-based private equity owner, Rhone Capital.
Reports cite, Rhone Capital is currently working alongside investment banking firm Citi on the proposed deal, which is expected to value the German foundry industry supplier at approximately €500 million ($559 million).
According to a report by Nasdaq, Rhone Capital is expected to market ASK Chemicals to some of its peers, including Imerys, Vesuvius, Huettenes-Albertus, RHI along with a number of other private equity firms. The move comes amid a deal making spell, currently occurring across the chemical sector.
Rhone, which acquired ASK Chemicals from the company’s former joint-owners, Ashland Inc. & Clariant AG, back in 2014 in a $350 million deal is expected to rollout information packages to all potential buyers by the mid of May.
A source familiar to the matter stated, given that ASK is heavily inclined towards foundries, who generally are suppliers to the automobile industry, question remains whether they intend to boost their exposure, in particular, to that sector.
The German company is expected to post its earnings prior to tax, interest, depreciation & amortization of approximately €65 million in 2019 and might be valued at a remuneration mark that is 7 to 8 times that based upon previous such deals in the sector.
The proposed sale also reportedly comes at a time where chemicals groups like Clariant and BASF are shedding-off their non-core assets specializing in construction industry products or for paints & coatings makers, and also after Evonik Industries finalized a deal to sell off its own methacrylates plastics unit.
According to reports, as the matter is still developing, Rhone & Citi have not released any further details pertaining to the sale.