February 10th, 2022
Clariant has signed definitive agreements to divest its 50 percent stake in the joint venture, which owns Scientific Design Company Inc., to its long-term joint venture partner, SABIC. SABIC is executing a call option raised in 2015 to acquire this stake, initially purchased by Süd-Chemie AG in 2003 and acquired by Clariant in 2011, under a change-of-control clause in the Joint Venture agreement.
Clariant reports a book value for the 50 percent stake in Scientific Design Company Inc. of CHF 108 million as of December 31, 2020. Both Clariant and SABIC completed a comprehensive, arms-length due diligence process to value Scientific Design at USD 260 million and Clariant’s 50 percent share at USD 130 million. With a profit-sharing agreement beginning on January 1, 2021, until the transaction’s closing, this represents an attractive valuation for Clariant’s 50 percent stake at around 12 times Scientific Design’s 2021 expected EBITDA, assuming a mid-2022 closing. The final amount is payable at closing, subject to the receipt of the required regulatory approvals. The closing is expected to take place in mid-2022.
In 2020, Scientific Design Company Inc. generated sales of CHF 121 million. Scientific Design Company Inc., headquartered in Little Ferry, New Jersey, United States, is present in the development, licensing, and catalyst supply of proprietary processes for the production of ethylene oxide (EO), ethylene glycol (EO/EG), bio-ethylene, bio-EO, bio-EG, EO derivatives, polyols and maleic anhydride. In addition to these technologies, Scientific Design Company Inc. produces proprietary catalysts and equipment for use in their own and other industrial processes.
