Evonik acquisition of PeroxyChem delayed by FTC lawsuit
- Evonik to defend FTC lawsuit seeking to block
acquisition of Peroxychem
- Evonik continues to believe that the transaction will benefit customers through the combination of Evonik’s and Peroxychem’s complementary businesses
- Evonik remains optimistic regarding its ability to
prevail at trial
Evonik will vigorously defend itself against the action of the Federal Trade Commission, which announced last Friday it will file a lawsuit seeking to block Evonik’s proposed acquisition of PeroxyChem, a worldwide manufacturer of specialty peroxygen chemistries.
“It is disappointing that the FTC has taken this step to block the acquisition in the highly competitive hydrogen peroxide industry,” said Christian Kullmann, chairman of the executive board of Evonik. “PeroxyChem offers products in attractive and
high-growth end markets that are complementary to Evonik’s product portfolio. The transaction represents an opportunity for Evonik to expand further into specialty hydrogen peroxide and peracetic acid product, optimize its distribution network, achieve substantial efficiencies, and grow production and sales. We
remain optimistic that we will prevail at trial and complete the acquisition.”
At the end of 2018, Evonik signed an agreement with One Equity Partners to acquire PeroxyChem for $625 million. Evonik was expecting to close the deal by the middle of 2019. However,
the FTC lawsuit means that closing will not occur before the end of 2019.
“We continue to believe that the complementary fit of the two businesses will unlock new and attractive growth opportunities for our customers and employees,” said Bruce Lerner, President and CEO of PeroxyChem.
Both companies will vigorously defend the transaction against the FTC’s lawsuit and intend to show the court that the FTC’s claims fail to recognize current market dynamics, in particular the substantial growth of specialty hydrogen peroxide applications that are PeroxyChem’s focus, and the significant synergies and customer benefits that will arise as a result of transaction.
During this time, the companies will continue to operate as business as usual.
Evonik is one of the world leaders in specialty chemicals. The focus on more specialty businesses, customer-oriented innovative prowess and a trustful and performance-oriented corporate culture form the heart of Evonik’s corporate strategy. They are the lever for profitable growth and a sustained increase in the value of the company. Evonik benefits specifically from its customer proximity and leading market positions. Evonik is active in over 100 countries around the world. In fiscal 2018, the enterprise with more than 32,000 employees generated sales of €13.3 billion and an operating profit (adjusted EBITDA) of €2.15 billion from continuing operations.
Evonik’s international activities are organized into six regions. The Asia Pacific North region is headquartered in Shanghai. Sales in Asia Pacific North reached €1.97 billion in 2018. Evonik regards China as one of the driving forces of the global economy and we consequently endeavor to grow our business here. The company now employs over 2,500 employees and has in total of 10 production sites in China.
In so far as forecasts or expectations are expressed in this press release or where our statements concern the future, these forecasts, expectations or statements may involve known or unknown risks and uncertainties. Actual results or developments may vary, depending on changes in the operating environment. Neither Evonik Industries AG nor its group companies assume an obligation to update the forecasts, expectations or statements contained in this release.