Lanxess to sell shareholding in Envalior by 2026
Speciality chemicals firm Lanxess will exercise its contractual right to offer to sell all its shares in Envalior (40.94%) to its joint venture partner, an investment company of Advent International. Subject to the availability of financing, the joint venture partner is obliged to acquire all or half of Lanxess' shares effective April 2026. If and to what extent the share sale will be completed will be known by March 2026 at the latest.
A base purchase price of approximately EUR1.2 billion was contractually agreed for the tendered shares. This results from the valuation of the High-Performance Materials business unit contributed by Lanxess in the course of the incorporation of the joint venture in 2023.
Potential adjustments to the purchase price may only arise from the development of Envalior's earnings before interest, taxes, depreciation and amortisation, it said.
The purchase price will increase, if the EBITDA in the 12 months to April 1, 2026, exceeds the core profit used as the basis for the valuation of the joint venture prior to the time of its incorporation.
If the current EBITDA falls below the historical EBITDA by more than 10%, the price will be reduced pro rata.
"Envalior's debt is not taken into account for the determination of the purchase price for the tendered shares," the chemicals group added.
If the sale of Lanxess' minority stake is not completed in 2026, additional possible tender or purchase periods will arise.
In 2027, Advent will have the right to acquire the shares at the same purchase price as in 2026. If this right is not exercised, Lanxess will offer it again in 2028, in accordance with the same valuation- and execution mechanism. In 2028, however, the acquisition of 50% of the shares held by Lanxess will no longer be subject to a financing condition or other conditions.
Lanxess adds it can therefore demand the acquisition of this amount of shares in any case. The base purchase price of approximately EUR1.2 billion Euro will continue to apply to the sale of any shares in 2028.
The shareholder loan of EUR200 million issued in the course of the incorporation of Envalior, as well as the accrued interest, are to be assumed and refunded by the joint venture partner in 2028 in proportion to the amount of Lanxess shares in Envalior sold at that time, i.e. at least 50% of the loan.
Cologne-based Lanxess and Advent completed the incorporation of Envalior in 2023. LANXESS contributed its High Performance Materials business, valued at EUR2.5 billion to the joint venture.
In addition, the Engineering Materials business of the Dutch group DSM became part of the joint venture's business.
Lanxess has already received an initial payment of EUR1.3 billion in 2023.
Envalior produces high-performance engineering polymers for a wide range of industries.
(PRA)SUBSCRIBE to Get the Latest Updates from PRA Click Here»
