Domo to acquire Solvay’s nylon business in Europe for EUR300 mn

Belgian family-owned nylon integrated producer Domo Chemicals is to acquire the Performance Polyamides Business of Solvay (Brussels) in Europe. The business needed to be divested to a third party as part of the European Commission’s merger control clearance process, towards completing the divestment of Solvay’s remaining polyamides business to Germany-based BASF. Domo will pay EUR300 million on a cash and debt free basis to acquire the business, which currently employs approximately 1,100 people.

The acquisition is expected to close by the end of Q4 2019, pending approval by the relevant authorities.

The assets acquired by Domo involve Solvay’s engineering plastics in France and Poland; high-performance fibres in France and polymer and intermediates operations in France, Spain and Poland. It also includes a stake in a newly created joint venture for adipic acid between BASF and Domo in France.

Domo said that the acquisition of the PA6.6 business will significantly strengthen its downstream nylon-based engineering plastics business and “create a European leader with scale, entering the market with a top position in PA6/6.6 in Europe.” The acquisition is expected to grow Domo’s turnover from EUR900 million to EUR1.6 billion.

BASF will acquire all the activities that are not included in the remedy package and that are part of the original agreement between Solvay and BASF signed at the end of 2017.

Solvay, BASF and Domo will continue to run their businesses separately until completion of the transaction, which remains subject to relevant merger control clearances, required regulatory approvals and completion of employee representatives procedures.

The entire transaction, which is based on a purchase price of EUR1.6 billion on a debt free and cash free basis, is expected to be completed by the end of 2019.