International private equity firm Cinven has entered into exclusive negotiations to acquire CHRYSO ('the Group'), a global specialty chemicals group for construction materials, for an undisclosed amount.
Headquartered in France, CHRYSO is a leading international producer of additives and admixtures which improve the performance of concrete and cement, and construction systems for the repair and maintenance of buildings. The Group operates across Europe, Africa, the Middle East, Asia and the US; with sales in more than 100 countries worldwide. The Group has 29 manufacturing facilities globally and four R&D centres, employing c. 1,130 people. CHRYSO is strongly focused on innovation and customer support, providing tailor-made solutions for its global cement and concrete manufacturer customer base.
Cinven's Industrials and French teams identified CHRYSO as an attractive investment opportunity based on:
- The Group's strong market position in an attractive market segment across both developed and emerging geographies;
- Its highly experienced management team led by President and Chief Executive Officer, Thierry Bernard, who has overseen the Group's strong historic growth;
- The Group's successful track record of acquiring and integrating businesses, including completing six acquisitions in the past two years, with further consolidation opportunities, particularly in emerging economies;
- The Group's excellent innovation capabilities facilitated through its R&D centres and close proximity to its customers;
- The strong growth in infrastructure spending, increasing housing demands in emerging economies, and a housing market recovery in Europe and the US; and
- Attractive geographic expansion opportunities into the Middle East and Southeast Asia.
This investment would follow Cinven's acquisition of French-headquartered Labco, one of the largest European operators of medical diagnostics laboratories, in August 2015, which Cinven subsequently merged with German-headquartered synlab in October 2015, to create the largest clinical laboratory services company in Europe.
Commenting on the CHRYSO investment, Xavier Geismar, Partner at Cinven, said:"We had identified CHRYSO as a strong business operating in the highly attractive building chemistry industry and have been following the company closely. Cinven is delighted to have this opportunity to invest in the business, backing the excellent management team. Our ability to move quickly to secure the investment reflects the effectiveness of our sector-geographic matrix origination approach, with our French and Industrials teams working closely together on the opportunity."
Nicolas Paulmier, Partner at Cinven, added:"We are very excited by the growth prospects at CHRYSO. The business is very well run and there are considerable opportunities to grow the business organically, as well as through acquisition and into other geographies. Cinven has a significant track record of working with companies to support their buy and build strategies and internationalising their businesses, particularly in Asia, and we are looking forward to doing this with CHRYSO."
Thierry Bernard, President and Chief Executive Officer of CHRYSO Group, said: "CHRYSO is extremely well positioned to benefit from several attractive market drivers including increasing concrete consumption for infrastructure and housing globally; the greater complexity and scale of construction projects - with tougher requirements on building materials performance; and a growing focus on sustainable development.
"We are very pleased to be working with Cinven given their considerable experience of growing companies responsibly and working closely with management teams to achieve global leadership."
CHRYSO will represent Cinven's fourth investment from The Sixth Cinven Fund. The works' council of CHRYSO will be consulted on the transaction and the completion of the transaction would be subject to customary regulatory approvals.