Brenntag acquire Chinese speciality chemicals distributor Wellstar

Brenntag to acquire Chinese speciality chemicals distributor Wellstar

6:57 AM, 28th June 2017
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MULHEIM, GERMANY: Brenntag AG has signed an agreement to acquire 100 percent shares in Wellstar Enterprises (Hong Kong) Company Limited and its 3 Chinese subsidiaries, jointly Wellstar Group.

Brenntag will gain a majority stake of 51 percent with a first tranche in 2017 and the remaining 49 percent via the second tranche by 2021. In the period from 2017 to 2021, the business will be operated as a joint venture.

Wellstar Group is headquartered in Hong Kong with its 3 Mainland China subsidiaries located in Shenzhen, Guangzhou and Shanghai. The company sells and distributes high-performance pigments, effect pigments, resins and kaolin used in a broad variety of industries among others in the coatings, inks, plastic and cosmetics industry. In addition, Wellstar Group offers value-added services through an application lab for coatings.

“The acquisition perfectly fits into Brenntag’s growth strategy in the Asia-Pacific region. Wellstar Group represents a competent and well-established speciality chemicals organisation. The company has an experienced sales team with broad experience in the relevant industry and offers strong technical competency and support to customers. The investment thus complements Brenntag China’s objective to build up a speciality chemical division for various industry segments,” said Henri Nejade, member of the management board of Brenntag Group and CEO Brenntag Asia Pacific.

“Brenntag considers the joint venture as well-positioned to grow on the back of favourable market trends, such as the growth in the automotive industry in China. Moreover, the acquisition gives us the opportunity to strengthen our relationship with a strategic key supplier, and we see synergy potential with our existing Brenntag China’s customer base,” added Anthony Gerace, managing director M&A, Brenntag Group.

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