Solenis to acquire Diversey
Speciality chemicals manufacturer Solenis has agreed to buy cleaning, infection prevention and hygiene giant Diversey. The $4.6 billion all-cash deal should be completed in 2H, subject to approval by Diversey shareholders, and will remove Diversey from public ownership. Both boards have backed it.
“In combining these two fully complementary businesses, we expect to usher in a new and exciting chapter in our long history of helping customers tackle core challenges such as water and energy management, partnering on sustainability issues to work towards a cleaner, safer world and reducing environmental impact,” said Solenis CEO John Panichella, who will lead the combined entity following transition and integration.
Platinum Equity-owned Solenis will pay $7.84/share to Diversey’s main owner, Bain Capital, which will roll over 56% of its stake into an affiliate of Solenis and sell the remainder to Solenis at the same price. Other shareholders will receive $8.40/share, which represents a 41% premium on the closing share price on 7 March, the last full trading day prior to the announcement.
This opens up new markets for Solenis, which focuses on the water-intensive industries such as pulp, packaging paper and board, tissue and towel, oil and gas, petroleum refining, chemical processing, mineral processing, biorefining, power, municipal, and pool and spa. It currently employs about 6,500 in 130 countries, compared to Diversey’s 9,000 in 80.
Solenis itself is the result of multiple mergers, beginning when private equity investor Clayton, Dubilier & Rice acquired the water treatment business of Ashland in 2014. The firm merged with BASF’s paper-wet-end and water-chemicals business in 2019. Two years later, Platinum Equity acquired Solenis and merging it into its existing water treatment subsidiary Sigura to create a player with $3.5 billion/year in sales.
Since then, the firm has made five bolt-on acquisitions. Most recently, in early February, it completed those of acquire the paper process chemicals business of Kolb Distribution, a unit of KLK Kolb, and Lima-based Grand Invest Group. None, however, was remotely as big as the deal with Diversey.