Mergers & Acquisitions

Germany’s Brenntag acquires two leading U.S. lubricant distributors

Germany's Brenntag acquires two leading U.S. lubricant distributors

Chemical distributor Brenntag, which is headquartered in Mülheim an der Ruhr, Germany, announced the acquisition of two leading lubricant distributors in the United States. The investment for both acquisitions totals USD 440 million.

J.A.M. Distributing Company, LLC, and related entities, headquartered in Houston, Texas, and G.H. BerlinWindward, headquartered in Manchester, N.H., distribute products across the entire lubricant supply chain in a broad range of customer industries. Both companies offer integrated product and service solutions focused on a wide range of lubricants servicing industrial, commercial, automotive, and marine end markets throughout the Gulf Coast, Texas and the northeast United States, respectively.

“Both acquisitions are a significant investment in rebalancing our industry mix in North America and complement our existing business in the less volatile lubricants market. This represents a strategic review and shift to counteract the structural change in oil & gas earnings in North America,” said Steven Holland, CEO of Brenntag Group.

“Both companies are valuable additions to our existing business in the lubricants distribution market which is attractive in terms of size, growth and profitability. Moreover, the market is still very fragmented. Together, J.A.M. and G.H. BerlinWindward will be an excellent platform for growth in this consolidating market. They will further diversify our industry portfolio and solidify our strong market position in lubricant distribution in North America,” said Markus Klähn, member of the Management Board of Brenntag Group and CEO of Brenntag North America.

Holland said the full year EBITDA earnings for the new acquisitions in 2016 are expected to be more than USD 50 million.

The combined companies are expected to contribute sales of approximately USD 780 million in the 2016 financial year.

The closing of the transactions will occur in the course of the next weeks, subject to contractually agreed closing conditions.

Brenntag operates a global network with more than 490 locations in 72 countries. In 2014, the company, which has a global workforce of more than 13,500, generated sales of EUR 10.0 billion (USD 13.3 billion). With more than 10,000 products and a world-class supplier base, Brenntag offers one-stop-shop solutions to around 170,000 customers.

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