SK Capital, a private investment firm focused on the specialty materials, chemicals and pharmaceuticals sectors, has signed a definitive agreement to acquire the Fire Safety and Oil Additives businesses of Israel Chemicals Ltd. (ICL) for approximately USD 1 billion. The transaction is expected to close in the first half of 2018, before which a new trade name will be selected and announced for the company.
The businesses which are headquartered in St. Louis, Mo., U.S.A., have global operations and are market leaders in each of their segments. The ICL Fire Safety business is a formulator and manufacturer of fire management chemicals. Its Phos-Chek fire retardants, Class A and B foams, and water enhancing gels are the world’s leading chemical solutions for managing wildland, military, industrial and municipal fires, and are used in partnership with fire management agencies across the globe. The ICL Oil Additives business provides high-quality phosphorus pentasulfide used in the preparation of ZDDP-based lubricant additives, in critical engine anti-wear solutions that lead to prolonged combustion engine function, as well as in pesticide and mining chemicals applications.
“This acquisition adds to SK Capital’s extensive experience of partnering with corporate sellers to execute carve-outs of non-core businesses and working with management to transform them into thriving, independent companies. As the global industry leader across both its segments, the company offers an unmatched, vital value proposition to its customers with the highest quality standards and a dedication to premier service,” said Aaron Davenport, managing director of SK Capital.
“We see multiple opportunities to invest in both organic and acquisitive growth to accelerate the company’s strategy of introducing its differentiated technology, proprietary formulations, and state-of-the-art service operations to new channels, geographies, and markets,” said Stephen d’Incelli, a principal of SK Capital.
“We look forward to collaborating with Eddie Goldberg, the leader of these businesses, the rest of the management team and the dedicated employee-base to support their continued growth as an independent company,” said Barry Penney, a principal of SK Capital.
The Valence Group, Rothschild & Co. and HSBC Securities (USA) Inc. acted as M&A advisors to SK Capital. Kirkland & Ellis LLP acted as legal advisor. Committed debt financing was provided by Barclays, Goldman Sachs USA, and HSBC Securities (USA) Inc.
SK Capital is a private investment firm with a disciplined focus on the specialty materials, chemicals and pharmaceuticals sectors. The firm’s purpose is to build strong and growing businesses that create substantial long-term economic value. SK utilizes its industry, operating and investment experience to identify opportunities to transform businesses into higher performing organizations with improved strategic positioning, growth and profitability as well as lower operating risk. SK’s portfolio of businesses generates revenues of approximately USD 6 billion annually, employs more than 8,700 people globally and operates more than 60 plants in 25 countries. The firm currently has approximately USD 1.9 billion of assets under management.
ICL is a global manufacturer of products based on specialty minerals that fulfill humanity’s essential needs primarily in three markets: agriculture, food and engineered materials. ICL shares are dual listed on the New York Stock Exchange and the Tel Aviv Stock Exchange. The company employs approximately 13,000 people worldwide, and its sales in 2016 totaled USD 5.4 billion.