독 Langses and US Advent Establish 5 Trillion Plastic Joint Venture

Acquisition of DSM Engineering Materials for 3.7 Billion Euros

"Launching in the First Half of Next Year... Responding to Demand for Cars and E-Mobility"

[Asia Economy Reporter Moon Chaeseok] German specialty chemicals company LANXESS and US private equity firm Advent International are establishing a joint venture for high-performance plastics.

On the 9th, LANXESS announced that it signed a contract to acquire DSM Engineering Materials from Advent and the Dutch chemical company Royal DSM Group for approximately 3.7 billion euros (about 4.99 trillion KRW). This acquisition is of a world-class supplier of thermoplastic plastics. The company’s sales amount to about 1.5 billion euros (about 2 trillion KRW), and its EBITDA (earnings before interest, taxes, depreciation, and amortization) margin is around 20%. If regulatory approval proceeds smoothly, the new joint venture is expected to launch in the first half of next year.

LANXESS will transfer its engineering plastics division, a world-leading supplier of high-performance plastics for the automotive industry, to the new joint venture. This division’s annual sales are about 1.5 billion euros (about 2 trillion KRW), and EBITDA is approximately 210 million euros (about 280 billion KRW). Advent will hold at least 60% of the joint venture’s shares. LANXESS will secure up to 40% ownership and at least 1.1 billion euros (about 1.48 trillion KRW).

Matthias Zachert, Chairman of LANXESS, said, “With the establishment of the new joint venture and the acquisition of DSM’s plastics business, a stronger global high-performance plastics supplier has been created,” adding, “In particular, the innovative products of both companies will play an important role in the future development of e-mobility.” Ronald Eyles, Managing Partner of Advent International, stated, “Based on the rich experience, know-how, and resources of both companies, we will make the new joint venture a global success story in the related industry.”

The DSM Engineering Materials business offers a range of engineering plastic products including polyamides (PA6, PA66). Approximately 2,100 employees work across eight production facilities and seven research centers worldwide. The business operates in Europe, North America, and Asia. LANXESS’s engineering plastics division is the world’s number one supplier of PA6, PBT engineering plastics, and thermoplastic composites. About 1,900 employees work at ten production facilities and seven research centers globally.

LANXESS believes the core customer market for the new joint venture will be the automotive industry, as engineering plastics are used in electric vehicle batteries and charging systems, as well as electronic control system materials.

This content was produced with the assistance of AI translation services.