PureTech Scientific, a platform company formed by Iron Path Capital, has acquired the glycolic acid business (GAB) of publicly traded Chemours Company for $137 million in cash.
Glycolic acid is a type of alpha hydroxy acid (AHA). Glycolic acid is used in skincare products such as creams, cleansers, and serums; in pharmaceuticals as a drug delivery system where it helps enhance the absorption and effectiveness of certain medications; and in industrial applications for metal cleaning and electroplating, and as a pH adjuster and co-solvent for certain chemical processes.
With the buy of GAB, PureTech Scientific is positioning itself as a provider of ultra-high purity alpha hydroxy acids used in the life sciences and other specialty chemical applications.
Iron Path Capital is an investor in lower-middle market companies that are active in the specialty industrial and healthcare sectors and have EBITDA of $5 million to $15 million. The firm was founded in 2021 by Rob Reistetter, a former principal at Quad-C, and Scott Mraz, a former senior executive of several Quad-C portfolio companies.
“The forming of PureTech Scientific and acquisition of Chemours’ glycolic acid business marks Iron Path’s first major investment in the specialty chemicals sector focused on the life science end markets,” said Mr. Mraz. “Our goal is to leverage Iron Path’s extensive operational expertise and technological capabilities to support PureTech Scientific’s growth plans through continued innovation with our customers.”
In 2022, Iron Path added Ted Clark as a partner to focus on investments in the specialty industrials sector. Mr. Clark is a former senior executive of H.B. Fuller, a St. Paul-based specialty chemical company. Mr. Clark joined H.B. Fuller following its 2017 acquisition of Royal Adhesives and Sealants (a portfolio company of Quad-C from 2003 to 2010), where he served as president and CEO. Iron Path has offices in Nashville, Tennessee, and Charlottesville, Virginia.
“The entire Glycolic Acid team has worked hard to create a leading business with an unmatched record of product quality, integrity and stewardship,” said Mr. Reistetter. “Iron Path’s long-standing expertise in specialty chemicals, coupled with a strategy devoted to growing this business, makes us the ideal partner invested in the success of GAB’s employees and customers.”
Chemours Company (NYSE: CC) is a producer of titanium dioxide for coatings and plastics, fluoropolymers for various industries, and a range of industrial chemicals and intermediates. The company has approximately 6,600 employees and 29 manufacturing sites serving approximately 2,900 customers in approximately 120 countries. Chemours, with annual revenues of more than $6.7 billion, is headquartered in Wilmington, Delaware.
“Our glycolic acid portfolio includes a range of technical and cosmetic grades suitable for use in diverse applications,” said Denise Dignam, the president of Chemours Chemical. “As passionate stewards of these brands, our team believes the portfolio is a fitting part of PureTech Scientific’s growth plan and is well reflected in the terms of this agreement.”
Grace Matthews is the financial advisor to Chemours on the sale of the glycolic acid business to PureTech Scientific. The transaction is expected to close by the third quarter of 2023.
© 2023 Private Equity Professional | June 7, 2023
