LANXESS completes sale of organic leather chemicals business
Cologne, Germany-based specialty chemicals company LANXESS has completed the sale of its organic leather chemicals business to TFL Ledertechnik GmbH on June 1, 2021. TFL is a global supplier of leather chemicals and a portfolio company of U.S. investment firm Black Diamond Capital Management, L.L.C. All relevant antitrust authorities have granted the necessary approvals for the transaction, which was announced in August 2020.
The purchase price comprises a fixed component of EUR80 million (USD97.8 million). Furthermore, the agreed trade working capital mechanism will lead to a payment of around EUR20 million (USD24 million), to be paid out in the third quarter. In addition, there will be a performance-related component of up to EUR115 million (USD140 million), 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.
In January 2020, LANXESS divested its chrome chemicals business and, at the end of 2019, signed an agreement to sell its stake in the South African chrome ore mine. LANXESS is thus exiting the leather chemicals business completely. Since the end of 2019, the company has reported the leather business unit as a discontinued operation.