SK Capital Partners has agreed to acquire SI Group, a manufacturer of specialty chemical additives and intermediates. SI Group is being acquired from the descendants of W. Howard Wright, who founded the company in 1906.
SI Group is a developer and manufacturer of additives and intermediates that are used in a range of end markets including pharmaceuticals, plastics, oil and gas, and tires. The company’s products include adhesives, antioxidants, fuels and lubricants, plastic additives, industrial resins, pharmaceuticals (Ibuprofen and Propofol), surfactants, and engineered plastics.
SI Group operates 20 manufacturing facilities in 10 countries with more than $1 billion in annual sales, and over 2,800 employees worldwide. The company is headquartered in Schenectady, NY (www.siigroup.com).
At the close of the transaction, SK Capital will combine SI Group and Addivant, a supplier of additives including antioxidants, antiozonants, inhibitors, polymer modifiers and UV stabilizers used in the polymers, plastics and rubber sectors. SK Capital formed Addivant in May 2013 to acquire the antioxidant and UV stabilizer business of Chemtura Corporation.
“We are excited that SI Group will be joining the SK Capital portfolio of chemicals and pharmaceuticals businesses,” said Barry Siadat, a co-founder and Managing Director of SK Capital. “SI Group has an excellent fit with the technologies and end markets of several SK Capital businesses, including Addivant in additives, Noramco in the area of pain management pharmaceuticals, and TPC Group in building block chemicals for certain SI Group products. These technology and market connections will enhance and accelerate the continued growth and transformation of SI Group. Additionally, by combining the complementary strengths of SI Group and Addivant, we will be creating a global technology and industry leader in plastic, lubricant, oilfield and rubber additives.”
SK Capital specializes in the specialty materials, chemicals and healthcare sectors and typically invests equity of $100 million to $200 million in each portfolio company. The firm has more than $2.2 billion of assets under management and is based in New York (www.skcapitalpartners.com).
“SK Capital is a firm known for its sound business practices, deep industry experience, and impressive portfolio of companies in the chemicals sector,” said Wallace Graham, Chairman of SI Group. “We are thrilled by the prospect of SI Group joining SK Capital, as it will enhance the company’s performance additives and intermediates business in the plastic, oil and gas, pharmaceutical and rubber sectors. We expect to see great things in the years ahead.”
Committed debt financing has been provided by JPMorgan Chase Bank, HSBC Securities (USA), Deutsche Bank Securities, and Bank of America. HSBC Securities (USA) was the financial advisor to SI Group.
This transaction is expected to close in the second half of 2018.
© 2018 Private Equity Professional | June 1, 2018
