"AECI and Clariant Southern Africa Proprietary Limited (“Clariant”) have reached an agreement for AECI’s wholly-owned subsidiary ImproChem Proprietary Limited (“ImproChem”) to acquire Clariant’s water treatment business in Africa and its South African assets for a total cash consideration of R409 million," AECI said.
Included in the acquisition is a 50 per cent shareholding in Blendtech, Clariant’s B-BBEE partner in South Africa.
Clariant is part of Switzerland-based Clariant International Limited.
The acquisition is in line with AECI’s strategy to extend its presence in Africa in the provision of water treatment solutions for a broad range of industrial and municipal customers, principally through ImproChem.
“ImproChem has established a footprint on the continent subsequent to the acquisition of GE’s Chemical and Monitoring Solutions business in Africa and the Indian Ocean Islands in 2012,” Mark Dytor, Chief Executive of AECI, said in a statement.
“On completion of the Clariant acquisition, which will also be merged with ImproChem, this footprint will be enhanced since ImproChem’s direct sales capability in many African countries will enable it to leverage Clariant’s penetration of these markets.”
“The divestment is a result of our continuous active portfolio management. The water treatment business no longer meets our positioning as a global leader in all of our businesses. Although water treatment is an attractive industry overall and the business is well positioned in Africa, Clariant decided to identify a better owner who is able to focus on this service-driven activity,” Clariant’s CEO Hariolf Kottmann said.
ImproChem has manufacturing, laboratory and engineering facilities in Johannesburg and Umbogintwini, south of Durban. Clariant has complementary facilities in Johannesburg and in Pietermaritzburg, KwaZulu-Natal.
The acquisition is subject to certain conditions precedent, including approval by the relevant competition authorities.