Evonik acquires a US catalyst company

On August 26, Evonik Industries Group announced that it had acquired the Porocel Group of the United States for US$210 million to accelerate the growth of its catalyst business. The purchase price is 9.1 times the company's adjusted earnings before interest, tax, depreciation and amortization (EBITDA) in 2019. For high-quality assets in the catalyst industry, this valuation is quite attractive. The transaction has yet to be approved by relevant authorities and is expected to be completed before the end of this year. The transaction will be completed through its steady free cash flow.

　　 Evonik stated that Porocel, headquartered in Houston, Texas, has a highly efficient regeneration technology for desulfurization catalysts that can be used to produce low-sulfur fuels, so its market demand is increasing. Compared with the production of new desulfurization catalyst products, the use of Porocel catalyst regeneration technology can reduce carbon dioxide emissions by more than 50%. In addition, Porocel's existing production capacity will help Evonik accelerate its expansion of the fixed bed catalyst business.

　　 Evonik stated that Porocel's global presence will help increase the global influence of Evonik’s catalyst business. Its business complements Evonik’s existing catalyst product portfolio. Together with its existing productivity, this acquisition will bring considerable growth opportunities to Evonik. By the end of 2025, the sales of the integrated catalyst business will increase significantly to more than 500 million euros without the need to increase new capacity investment.

Couleman, Chairman of Evonik Industries Group, said: “This acquisition is an important step in the development strategy of Evonik’s product portfolio. Our business is focused on robust and profitable specialty chemicals. We are systematically expanding our specialty chemicals business. "Sustainable development, especially circular economy, is one of Evonik’s biggest considerations in terms of acquisition and product portfolio positioning," said Claus Rettig, head of Evonik’s smart materials business unit. The demand for carbon dioxide emission reduction and resource saving is increasing. The acquisition of Porocel will help us better meet these market demands. Compared with the production of brand-new catalyst products, the use of catalyst regeneration technology can significantly reduce carbon dioxide emissions. The production of regenerated catalysts and new products The efficiency is equivalent, but the cost is much lower."

　　Porocel's business revolves around the core technology of desulfurization catalyst regeneration, including purification adsorbent business, sulfur recovery catalyst business and hydroprocessing services. Terence McHugh, President and Chief Operating Officer of Porocel, said: "Our innovation comes from the company's talent team, which fits well with Evonik's corporate culture. We look forward to working with Evonik to promote business development to the next level."