Cologne, Germany – Lanxess is to sell its Urethane Systems business to Japan’s UBE Corporation. It expects the proceeds of the deal will be about €500m, with the enterprise value of the business amounting to €460m. The company plans to use the cash to reduce its net debt.
Urethane Systems posted sales of about €250m in the 12 months to June 2024. It has five manufacturing sites around the world, plus application labs in the US, Europe and China. UBE is taking over all of these operations, including about 400 employees. The business became part of Lanxess after its 2017 acquisition of Chemtura.
“The sale of Urethane Systems marks another milestone in our fast transformation into a pure-play specialty chemicals company, as we are divesting the last remaining polymer business in our portfolio,” said Matthias Zachert, chairman of the Lanxess board of management.
“We are convinced that the urethanes business will have significantly enhanced opportunities for growth and development under the umbrella of UBE. At the same time, we are using the proceeds from the transaction to strengthen our balance sheet by further reducing our net debt.”
UBE said the acquisition is part of its aim to achieve growth driven by specialty chemicals and contributions to the global environment. “We are strategically investing in our specialty business while restructuring and optimising our foundational sectors, such as the ammonia and caprolactam chains, to transform our corporate structure for the future,” it said.
“The acquisition emphasises our ambition to integrate high-performance polyurethane resin operations, enhancing our capabilities in these critical domains.”
Lanxess initially announced its intention to sell the business back in November 2023. The companies expect the transaction will close in the first half of 2025, subject to the approval of the relevant authorities.