Clariant reached an agreement to sell its pigment business unit, marking the completion of its sales plan

Clariant, a dedicated, sustainable and innovative specialty chemical company, announced that it has reached a final agreement to sell its pigment business to a consortium jointly established by the Heubach Group ("Heubach") and SK Capital Partners ("SK Capital"), based on The basis of cashless and debt-free, the enterprise value is 805 million to 855 million Swiss francs, and whether the earn-out payment plan of 50 million Swiss francs will be paid will depend on the financial performance of Clariant's pigment business in 2021 It depends, which is equivalent to 10.7 to 11.4 times (LTM) of the 12-month profit before tax, interest, depreciation and amortization (EBITDA) after independent adjustments in April 2021.

When the transaction is completed, Clariant will reinvest and become a 20% shareholder of the ultimate holding company together with Heubach and SK Capital. The combined company will become a global pigment company with approximately 3,000 employees, annual sales of more than 900 million euros, and strong global service and production capabilities.

This reinvestment enables Clariant to further benefit from the improvement in the profitability of the pigment business brought about by the efficiency enhancement plan, participate in future growth opportunities, and bring out the synergies after the merger with Heubach's pigment business.

The transaction is subject to required delivery conditions and regulatory approvals. These are expected to be completed in the first half of 2022. Clariant’s pigment business’s shares in Infraserv Höchst, Germany are not part of this transaction.

Once the transaction is completed, Clariant will finally complete its sale plan, together with its previously sold medical packaging and masterbatch businesses, as part of its product portfolio upgrade. The sale of the pigment business unit marks Clariant's transformation into a high-value specialty chemicals company with above-market growth, higher profitability and stronger cash generation capabilities.

The proceeds from the sale of the pigment business unit will be used to invest in growth projects in core business areas, implement sustainable development and innovation strategies, fund performance improvement plans, strengthen Clariant’s balance sheet, and reinvest in Clariant’s merger with Heubach In the paint business.

Clariant's pigment business unit is the world's leading supplier of high-quality organic pigments, pigment preparations and dyes, and its products are widely used in the automotive, industrial and architectural coatings, and plastics industries. In 2020, 1,900 employees in this business unit generated sales of approximately 850 million Swiss francs after independent adjustments.