Littlejohn & Co. has signed an agreement to acquire Cornerstone Chemical Company from H.I.G. Capital. In 2011, H.I.G. acquired the Building Block Chemicals segment of Cytec Industries for $180 million and renamed it Cornerstone Chemical Company. At that time, the segment had revenues of approximately $600 million.
Cornerstone is a producer of intermediate chemicals, including melamine, acrylonitrile, sulfuric acid, and urea that are used in a range of industrial and consumer applications such as water treatment, oil recovery, agriculture, plastics, furniture and flooring, and coatings. The company has an 800-acre chemical manufacturing and storage complex and employs approximately 460 people. Cornerstone, led by CEO Greg Zoglio, is headquartered near New Orleans in Waggaman, LA (www.cornerstonechemco.com).
Cornerstone is one of the largest producers of melamine – a raw material used for coatings, laminates, fire retardants, molding compounds, and wood adhesives – in North America; a leading manufacturer of acrylonitrile – used in the production of acrylamide, acrylic fibers, nitrile rubber, elastomers, ABS plastics, and surface coatings – in the US; and a major supplier of sulfuric acid – used as a drying agent in the production of industrial gases – in the Gulf Coast region.
“Cornerstone is a market leader with deep customer relationships, favorable industry dynamics, and numerous growth opportunities,” said Drew Greenwood, a Principal at Littlejohn. “We are delighted to be partnering with Cornerstone and its strong management team as the company accelerates its growth and expansion plans.”
Littlejohn makes control and non-control investments in middle-market companies that are undergoing a fundamental change in capital structure, strategy, operations or growth. The firm invests from $50 million to $150 million of equity in middle market companies that have annual revenues of $100 million to $800 million. Littlejohn invests across a range of industries and acquires manufacturers, distributors, and service providers. The firm is currently investing from Littlejohn Fund V, LP, which has $2 billion in capital commitments. Littlejohn is based in Greenwich, CT (www.littlejohnllc.com).
Goldman Sachs has provided committed financing to support the acquisition. KeyBanc Capital Markets was the financial advisor to Cornerstone.
This transaction is expected to close in August 2017.
© 2017 Private Equity Professional | July 21, 2017
