The Aditya Birla Group announced today that it had entered into a definitive agreement to acquire Columbian Chemicals Company from One Equity Partners, a unit of JP Morgan Chase. The acquisition is being carried out through Birla’s subsidiaries Alexandria Carbon Black, Thai Carbon Black, and SKI Investment.
The press release did not include details of the transaction, but Money Control put the price at $875 million, on a zero debt basis. The deal is expected to be completed by mid-2011.
While addressing the press, Aditya Birla Group chairman Kumar Mangalam Birla said the group hoped to complete the deal by mid-2011. This transaction has been done by privately held companies of the Aditya Birla group. Birla pointed out that the transaction will be done through three of the companies. One is Alexandria which is an Egypt-based company for the AV Birla Group there which has some operation in the Egyptian market as far as Carbon Black is concerned. Then you have the Thai Carbon and then SKI Investment, a holding company in the Aditya Birla Group. The total transaction value, as he said, is USD 875 million and will be on a zero debt basis.
The transaction will make the new Birla/Columbian the largest carbon black producer in the world, with 1.98 million tonnes/year of capacity, compared to 1.91 million tonnes/year for Cabot and 1.36 million tonnes/year for Evonik Carbon Black.
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