Merck signs agreement to sell surface solutions business unit to GNMI
Merck, a science and technology company, has signed an agreement to sell its global Surface Solutions business unit to Global New Material International Holdings for € 665 million in cash. Merck intends to use the net proceeds from the divestment to further strengthen its strategic core businesses.
Surface Solutions offers pigment solutions used in coating, industrial and cosmetic applications. The business unit generated sales of € 411 million in 2023. Roughly 1,200 employees, approximately 700 of whom are based in Germany, are to be transferred to GNMI as part of the transaction.
GNMI, also known under the brand name Chesir, is one of the largest pearlescent pigment producers. Founded in 2011, the company has sites in China and Korea with approximately 800 employees and is listed on the Hong Kong stock exchange. GNMI has profound expertise in effect pigments and the rapidly growing and competitive field of mica-based products. The company is characterized by a deep understanding of the Asian and, in particular, the Chinese market, especially in the area of pearlescent pigments, industrial coatings and plastics. It also specializes in rapid commercialization and optimized profitability through economies of scale.
To prepare for the completion of the sale, an integration team comprising representatives of both companies will be set up to define how the strengths of both businesses can best be combined. In addition, GNMI is planning for the Surface Solutions business unit to have three regional headquarters with one each in Germany, the United States and Asia, while maintaining its existing production facilities in Gernsheim, Germany, Onahama, Japan, and Savannah, Georgia, USA. Merck will remain the owner of the property at the Gernsheim site with a long-term lease contract with GNMI and a clear separation plan for the area used by Surface Solutions. The GreenTech Park Fluxum in Gernsheim is not affected by the sale.
The transaction is expected to close in the course of 2025 and is subject to regulatory approvals and the satisfaction of certain other customary closing conditions. The sale of Surface Solutions does not yet comprise the French Surface Solutions business, where GNMI has made a binding offer to acquire the relevant shares and assets once Merck has informed and consulted with the relevant works council representatives.
