Specialty chemicals company LANXESS is expanding its portfolio of material protection products by taking over the Clean and Disinfect business of US-based chemical company Chemours. The business comprises active ingredients as well as specialty chemicals used especially in disinfectant and hygiene solutions. One of its core products is the Virkon S branded disinfectant, that is being deployed globally in the growth sector of veterinary disinfection and in the combat against major diseases such as Foot-and-Mouth disease or Avian Influenza.

Both companies have now signed an acquisition agreement. The enterprise value of around EUR 210 million will be paid by LANXESS from existing liquidity. Closing is expected in the second half of 2016. The transaction is still subject to approval from the relevant antitrust authorities.

The acquisition will be earnings per share (EPS) accretive in the first fiscal year. The acquired business is expected to generate an annual EBITDA contribution of around EUR 20 million, which will increase gradually with synergy effects to roughly EUR 30 million by 2020.

The deal is LANXESS’ first acquisition after the completion of its realignment program. “We plan to enhance our position particularly in mid-sized, less cyclical markets with high margins and sound growth prospects,” said Matthias Zachert, Chairman of the Board of Management of LANXESS AG. “We have made quick headway and are now expanding our specialty chemicals portfolio which will make us more profitable and more resilient.”

LANXESS takes over Chemours‘ Clean and Disinfect business with 170 employees worldwide and three production sites in Memphis and North Kingstown, USA, and Sudbury, United Kingdom. In 2015, the business achieved sales of around EUR 100 million, roughly half of which in the region of North America. “Through the acquisition, we will grow especially in the region of North America, where we still see good opportunities,” said Zachert.

The new business will be integrated into LANXESS’ Material Protection Products business unit. “With the acquisition of Chemours’ Clean and Disinfect business, we are not only expanding our portfolio of active ingredients, but are also able to establish a forward integrated value chain in the veterinary disinfection segment,” said Michael Schäfer, head of the Material Protection Products business unit. “Above, we will benefit from Chemours’ experienced and dedicated employees, its strong technical and regulatory expertise, its widely recognized brands and well-established distribution networks.”