OM to buy Rockwood Holdings' electronics biz for $265M
By Colleen Taylor, Contributing Editor -- EDN, October 8, 2007
In a major buy for the specialty chemicals producer that marks its expansion into the solar technology realm, OM Group Inc. (OMG) has inked an agreement to acquire all of Rockwood Holdings Inc.'s electronics business for around $265 million in cash.
Rockwood's French electronic chemicals business is not included in the deal; however, it is subject to a put option for an additional purchase price of approximately $50 million. In a statement today, OMG said that the acquisition is expected to close by the end of 2007 and is subject to regulatory approval.
According to OM, the two businesses involved in the deal supply customers with chemicals used in the manufacture of semiconductors and printed circuit boards as well as photo-imaging masks primarily for semiconductor and photovoltaic manufacturers. The Rockwood electronics businesses employ approximately 700 people and have locations in the United States, the United Kingdom, France, Taiwan, Singapore and China.
"These are attractive, profitable, cash-generating businesses that participate in high-growth markets and have a global asset base that will broaden our geographic footprint," Joseph M. Scaminace, OMG's chairman and CEO, said in a statement. "Moreover, they fit precisely with our transformation strategy and match up well with our current portfolio." Scaminace added that the acquisitions will allow OMG to have a more predictable financial performance by reducing the company's exposure to "metal price volatility."
With the photovoltaic products connection, the acquisition gives OMG exposure to the solar market. OMG is not the only tech company making steps toward the alternative energy realm in recent months; in the past year Applied Materials Inc. has made ambitious moves toward expanding its semiconductor and thin film operations to include solar panel products, and the company has said it is now looking forward to revenues of $500 million by 2011 from solar panel applications alone.
