Select Page

Lanxess to end partnership with Saudi Aramco

Lanxess to end partnership with Saudi Aramco

To strengthen its financial basis and reduce net financial debt, Lanxess plans to sell its remaining 50 percent stake in Arlanxeo to its joint venture partner Saudi Aramco. Both companies signed an agreement today.

The total joint venture Arlanxeo is valued at EUR 3.0 billion. Lanxess expects to receive approximately EUR 1.4 billion in cash after deducting debt and other financial liabilities for its 50 percent share.

Arlanxeo was formed by Lanxess and Arlanxeo in 2016 as a 50:50 joint venture for synthetic rubber.

The transaction is still subject to approval of the relevant antitrust authorities. At the same time, information or consultation of the competent employee representative bodies will take place. The parties expect to complete the envisaged transaction by the end of 2018.

Originally, LANXESS and Saudi Aramco agreed on a lock-up period until 2021 for both partners. “With the envisaged transaction we would complete another important milestone of our strategic transformation earlier than originally planned. This should allow us to even better focus on our position as a leading player in mid-sized specialty chemicals markets,” said Matthias Zachert, Chairman of the Board of Management.

“At the same time, we increase the resilience of our business, strengthen our financial basis and gain additional strategic flexibility for further growth.“

Headquartered in Maastricht/Netherlands, Arlanxeo generated sales of around EUR 3.2 billion in 2017 and employs about 3,800 people at 20 production sites in nine countries. The company produces high-performance rubber for use in, for example, the automotive and tire industries, the construction industry, and the oil and gas industries.

Back in 2016, the transfer of the business with synthetic rubber into the joint venture Arlanxeo was the foundation for Lanxess’ strategic realignment. Since then Lanxess has been focusing on growth in mid-sized specialty chemicals markets and made various acquisitions in this area – with the takeover of the U.S. chemical company Chemtura in 2017 as the biggest one.

 

About The Author

Leave a reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Latest Issue

Newsletter Subscription

Recent Tweets

Subscribe To Our Newsletter

Join our mailing list to receive the latest news and updates from our team.

You have Successfully Subscribed!