Private Equity Firms Buy Two USW-Represented Chemical Plants

The ongoing pandemic negatively affected the world economy and slowed the pace of chemical company divestitures and acquisitions last year. However, deal-making started rebounding in the third quarter, including the sale of two USW-represented plants to private equity firms announced in the past month.

In December, One Rock Capital Partners, LLC, a U.S.-based private equity firm, agreed to buy BASF’s Kankakee, Ill., plant. USW Local 7-429 represents about 82 workers at the facility, which produces food grade vitamin E and chemical bases used in soap products.

USW District 7 Staff Representative Frank Shubert said he will be working with the local and the new owners to ensure a smooth transition.

BASF said the sale is expected to close the first half of 2021, and is subject to the approval of the relevant governmental authorities.

Solvay University Park sale

Solvay announced Jan. 5 that it is selling its USW-represented University Park, Ill., facility to OpenGate Capital, a private equity firm based in Los Angeles. Some 56 members of Local 7-2011 make amphoteric surfactant chemicals used in shampoos and body soaps.

Shubert said he received notification of the sale, which will be a stock transaction, on Jan. 5. The buyer has indicated to the union they intend to honor the contract.

The USW dealt previously with OpenGate Capital in 2011 when it purchased a boxboard manufacturer. The company negotiated a six-year contract with USW Local 1840 in early 2014 as it negotiated to sell the property to another company.

Other Chemical Deals

Other chemical companies also announced mergers and acquisitions in 2020.

DuPont’s sale in 2020 of its nutrition and industrial biosciences division to International Flavors & Fragrances will close this year.

Huntsman sold its shares in Venator, its former titanium dioxide business, in 2020 to private equity firm SK Capital Partners for $100 million, and plans to invest it in future growth.

Ineos purchased two petrochemical businesses from BP.

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