FRANKFURT Feb 5 Specialty chemicals producer
Rockwood and its Finnish partner Kemira are
renewing their efforts to sell German titanium dioxide unit
Sachtleben, people familiar with the deal said.
After yielding little interest in earlier auctions, they
have lowered their price expectations, the people said.
Sources had told Reuters almost a year ago that Rockwood and
Kemira were looking at selling or floating Sachtleben, which has
about 835 million euros in annual sales.
One source said Sachtleben's owners were now eyeing a price
tag of $875 million or five times earnings before interest,
taxes, depreciation and amortisation (EBITDA) expected for 2013,
compared with a previous aim for seven to eight times EBITDA.
"That is still sky high," one person close to a possible
Strategic players as well as private equity firms such as
CVC and Bain Capital are expected to look at the asset.
At an investor day in January, Rockwood said it was
considering all strategic options for Sachtleben, of which it
owns 61 percent.
"Based on what we said last month, it is natural to assume
that we would be consulting with advisors, one of whom is
Lazard," a spokeswoman for Rockwood said. Lazard declined to
comment and Kemira was not available for comment.
The titanium dioxide industry - with Dupont, Saudi
Arabia's Cristal Global, Tronox and Huntsman as
the largest players - has suffered a roller coaster ride in
Producers slashed capacity in 2009 during the economic
crisis, only to see demand rebound and product prices soar in
2010 and 2011, driven by automotive demand. As idled plants came
back on stream, prices came under pressure again 2012.
Titanium dioxide particles are used to reflect light,
creating the whiteness in paints and car coatings. It is also
used to protect wood or plastic surfaces from bleaching out, as
sunblock in skin cream, and to take the shine out of synthetic
They accounted for a quarter of Rockwood's 2011 group sales
of $3.67 billion.