Chemtura to sell BioLab to KIK
Chemtura Corporation, the parent company of BioLab, Inc, has entered into a stock purchase agreement to sell its global consumer products business to KIK Custom Products.
BioLab is a global manufacturer and marketer of pool and spa brands such as BioGuard, Bayrol, SpaGuard, Omni and Sun and is considered the largest supplier of residential pool chemicals in the world.
The purchase price is $US315 million.
The sale from Chemtura Corporation (NYSE/EuroNext Paris: CHMT) includes two dedicated manufacturing plants in the United States (Conyers, Georgia and Lake Charles, Louisiana) and one in Atlantis, South Africa.
BioLab Australia and New Zealand Director Lindsay McGrath says he and the team are very excited about their new investor, KIK Custom Products Inc.
“Having a dedicated partner who is another established leader in the global market only adds to our current value offering to the local markets,” he says.
“We’ve been owned by multiple players before and this is really just the next stage in the evolution of BioLab. There will be minimal changes, at least in the operation of the business.
“Initially it’s quite exciting to go from a being owned by a publically owned group into a privately owned group with an interest in the pool and spa industry.
“With the deals and partnerships KIK has made recently with other major brands like Clorox it shows the size and scope that a company like that can bring. We’ve looked at KIK’s growth over the past several years and seen an expansion to generic household products and then smaller brands, and now they’ve bought the world’s biggest brand in residential pool chemicals.
“We’re looking forward to having new owners who are dedicated to the pool industry and expect to have support to expand our own portfolio across the region.
“The purchase has been well received by our customers and the hands-on and ground-up support will continue,” he says.
The purchase is for the entire BioLab network including the 56 Poolside stores across Australia and New Zealand.
The acquisition is subject to customary closing conditions and regulatory approvals and is not expected to close before December 31, 2013.
“This acquisition is an important step for BioLab as we drive towards our long-term vision,” says Jon Viner, President of BioLab. “Being part of a consumer oriented company like KIK allows us to focus on our strategy of bringing innovative solutions to the market and providing even greater service to our dealers and retail partners.”
“This acquisition will be an important step in the next-stage growth of our company,” says Jeff Nodland, CEO, KIK. “We expect it to contribute to generating strong free cash flow while diversifying our product portfolio and expanding our customers and channels.”
“The BioLab and Bayrol businesses have a history of innovation and excellent service in the markets they serve,” says Stratis Katsiris, President of KIK’s Classic Division. “We are excited about this acquisition, which enhances our household cleaning portfolio and furthers our ongoing commitment to pool care.”
KIK entered the pool care business in 2011 with the acquisition of US-based Chem-Lab Products Inc., and the Kem-Tek brand which includes Easy 123.
KIK is a portfolio company of New York-based private equity firm CI Capital Partners. The transaction will be financed through debt underwritten by Credit Suisse and UBS Investment Bank and an equity investment in KIK made by an affiliate of CI Capital Partners.
KIK Custom Products is one of North America’s largest contract and private label manufacturers of consumer, institutional and industrial products. KIK produces national brand and private label consumer products for Fortune 500 companies.
In June 2011, KIK acquired Chem Lab Products Inc. (since renamed KIK Pool Additives Inc.), a regional manufacturer of liquid and dry chemicals for the pool and spa markets including and the Kem-Tek label and Easy 123 brand, as well as retail household bleach. The acquisition expanded KIK's Classic Division footprint and portfolio and gave the Company a platform from which to build a national, private label pool additives business.
KIK recently entered into a partnership to manufacture pool and spa chemicals for giant household chemical company Clorox which will be represented by Easy 123.
Between the deal signing and transaction closing, KIK and BioLab will maintain “business as usual” as separate companies.
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