Lanxess to acquire IFFs microbial control business
Lanxess aims to become one of the world’s largest suppliers of antimicrobial protection products by acquiring IFF’s Microbial Control business. Lanxess will pay around USD 1.3 billion (EUR 1.1 billion) for the acquisition.
The specialty chemicals company Lanxess intends to take over the microbial control business of the U.S. group International Flavors & Fragrances Inc. (IFF). Both companies signed a corresponding agreement on August 23, 2021. IFF Microbial Control is one of the leading suppliers of antimicrobial active ingredients and formulations for material protection, preservatives and disinfectants. The products are used in a wide range of applications, particularly in paints and coatings, personal care and household products as well as industrial water treatment.
The transaction is still subject to approval by the relevant antitrust authorities. In addition, the business must first be carved out from the IFF Group. Lanxess expects the transaction to be completed in the second quarter of 2022. Within four years after the closing of the transaction, Lanxess expects synergies to add approximately USD 35 million (EUR 30 million) in EBITDA.
Bridge financing
Lanxess will pay around USD 1.3 billion (EUR 1.1 billion) for the acquisition. The Group will finance the purchase price with debt capital and has secured respective bridge financing for this purpose.
IFF Microbial Control employs around 270 people and operates two production facilities at its U.S. sites in St. Charles, Louisiana, and Institute, West Virginia. The business also maintains a large partner network with active ingredient manufacturers and formulators. Following completion of the acquisition, the business is to be integrated into Lanxess’ Material Protection Products business unit.
