AECI acquires GE water treatment business in Africa

AECI acquires GE water treatment business in Africa

4:28 AM, 2nd July 2012
AECI acquires GE water treatment business in Africa

GALLO MANOR, SOUTH AFRICA: Chemicals and explosives company AECI has bought Chemical & Monitoring Solutions, General Electric’s (GE) water treatment business in Africa, for $20 million. The acquisition will be merged into AECI’s wholly owned subsidiary ImproChem, which is at the forefront of AECI’s drive to be a leading supplier of speciality water-treatment chemicals and services in Africa.

According to AECI the acquisition, which the Competition Commission had already approved, covered all African countries except Algeria, Egypt, Libya, Morocco, Tunisia and the Indian Ocean islands of Madagascar, Mauritius, Reunion and the Seychelles. As part of the acquisition agreement, ImproChem will produce chemical products using GE formulations at its Umbogintwini plant (south of Durban). GE will also have the right to consider forming a joint venture with ImproChem in the future.

In addition to AECI’s acquisition of Chemical & Monitoring Solutions, AECI and GE have also agreed on an exclusive distribution and licensing arrangement that still gives GE direct involvement in Chemical & Monitoring Solutions. The acquisition, which is effective from next month, follows last year’s non-exclusive distribution arrangement between GE and ImproChem. AECI expects a fall of more than 20 per cent in earnings for the six months to June 30.

© BusinessDay News

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