Newly formed Lanxess/Advent jv known as Envalior; sales of EUR4 bn

Newly formed Lanxess/Advent jv known as Envalior; sales of EUR4 bn

With Dutch firm DSM having completed the sale of its Engineering Materials business to Advent International (60%) and German materials firm Lanxess for EUR3.85 billion, a new company name for the joint venture, Envalior, has been announced for the global engineering materials business. With a turnover of around EUR4 billion, and a global workforce of around 4,000 employees worldwide, Envalior will be based near Düsseldorf, Germany, and headed by former Ineos manager Calum MacLean as CEO.

Envalior emerges from the combination of two complementary industry leaders in engineering materials – DSM Engineering Materials (DEM) and Lanxess High Performance Materials (HPM) – under the majority ownership (60%) of private equity firm Advent International and specialty chemicals company Lanxess (40%).

Lanxess HPM portfolio is focused on polyamide (PA) and polybutylene terephthalate PBT) and also incorporates a glass fibre compounding unit, was once part of Bayer as was Covestro’s PC and PU units. Envalior also comprises DSM’s engineering plastics businesses, which along with PA specialties produces polyester and polyphenylene sulphide (PPS).

The agreement was initially announced by DSM on 31 May 2022 and the transaction marks the conclusion of DSM’s review of strategic options for its two Materials businesses. It has also sold DSM Protective Materials to Avient Corporation, in order to focus on Health and Nutrition. DSM anticipates a book profit on the sale of Engineering Materials of around EUR2.7 billion. DSM will receive approximately EUR3.5 billion net in cash.

DSM Engineering Materials represented EUR1.5 billion of DSM’s total annual net sales and EUR334 million of DSM’s total Adjusted EBITDA for 2021.

As part of the deal, Lanxess received a payment of around EUR1.3 billion from Advent which it says it plans to use mainly to reduce debt and strengthen its balance sheet. The company also will support the new start-up with a loan of EUR200 million.

As well, Lanxess has the option to sell its stake back to Advent, three years from now.

Advent is said to have extensive investment experience in the global chemical sector with a proven track record in transforming companies from corporate carve-outs into industry-leading players. Advent also fosters the growth and market position of portfolio companies through further acquisitions and organic investments.


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