Specialty chemicals company LANXESS has completed the sale of its organic leather chemicals business to TFL Ledertechnik GmbH (TFL), a global supplier of leather chemicals and a portfolio company of US investment firm Black Diamond Capital Management.  

The purchase price comprises a fixed component of EUR 80 million. Furthermore, the agreed trade working capital mechanism will lead to a payment of around EUR 20 million, to be paid out in the third quarter. In addition, there will be a performance-related component of up to 115 million euros, to be paid out over the next three years. TFL has also assumed certain liabilities associated with the business. With the sale, all operations of the organic leather chemicals business line with around 420 employees have been transferred to TFL. 

TFL business activities comprise the development, production and marketing of specialty chemicals such as tanning agents, dyestuffs and finishing products, which enable its customers, mainly tanneries, to create an attractive end article such as leather automotive interior. The company is looking forward to combining two world-leading leather chemicals businesses. 

The integrated business will offer an unparalleled range of high performing, innovative and sustainable solutions to the leather industry.

The enhanced scale of the company will support TFL's goal to build the Top Performing Leather Chemical Company and significantly strengthens TFL's finishing product portfolio and presence in the automotive industry. LANXESS manufactures a broad range of leather chemicals at its plants in Europe and China, and has a worldwide network of application-oriented laboratories and sales offices. 

The combined TFL and LANXESS leather businesses will employ around 1,200 people worldwide and have a turnover of approximately €450 million on a proforma basis. With production facilities in Germany, Italy, France, Brazil, India and China and a presence in over 90 countries, it will provide truly global coverage. TFL is continuing to work very intensively in order to guarantee a smooth transition for all of its stakeholders.