Evonik: Acquisition of PeroxyChem delayed by FTC lawsuit
Evonik said it will vigorously defend itself against the action of the Federal Trade Commission, which announced it will file a lawsuit seeking to block Evonik’s proposed acquisition of PeroxyChem, a worldwide manufacturer of speciality peroxygen chemistries.
At the end of 2018, Evonik signed an agreement with One Equity Partners to acquire PeroxyChem for USD 625 million. The company was expecting to close the deal by the middle of 2019. However, the FTC lawsuit means that closing will not occur before the end of 2019, according to Evonik.
“It is disappointing that the FTC has taken this step to block the acquisition in the highly competitive hydrogen peroxide industry,” said Christian Kullmann, chairman of the executive board of Evonik. “PeroxyChem offers products in attractive and high-growth end markets that are complementary to Evonik’s product portfolio. The transaction represents an opportunity for Evonik to expand further into specialty hydrogen peroxide and peracetic acid product, optimise its distribution network, achieve substantial efficiencies, and grow production and sales. We remain optimistic that we will prevail at trial and complete the acquisition.”
“We continue to believe that the complementary fit of the two businesses will unlock new and attractive growth opportunities for our customers and employees,” said Bruce Lerner, President and CEO of PeroxyChem. Both companies said they will vigorously defend the transaction against the FTC’s lawsuit and intend to show the court that the FTC’s claims fail to recognise current market dynamics, in particular the substantial growth of speciality hydrogen peroxide applications that are PeroxyChem’s focus, and the synergies and customer benefits that will arise as a result of transaction. During this time, the companies will continue to operate as business as usual.