Malaysia’s Petronas Chemicals Group Berhad announced Tuesday it will acquire Sweden-based specialty chemicals company Perstorp Holding AB for €2.3 billion (10.5 billion ringgit or U.S. $2.3 billion). Perstorp’s products include carboxylic acids and other chemicals used in lubricants.
Petronas Chemicals officials said the deal will help it diversify into specialty chemicals, capture growth opportunities and buffer against market cycles and volatility.
Perstorp President and CEO Jan Secher said, “By tapping into the Petronas strong global brand and PCG’s strength as a reputable industry and market leader in the Asia-Pacific region, we are confident that Perstorp can continue to expand into its next phase of growth.”
The Perstorp acquisition follows Petronas’ €163 million acquisition in May 2019 of BRB Group, an independent producer and formulator of lube oil additives, silicones and other chemicals.
Perstorp has seven manufacturing sites and three research and development centers worldwide, with a presence in 26 countries, including the United States, Europe and Asia-Pacific. It has about 1,500 employees and serves more than 2,600 customers with its 130 product offerings within 30 product groups.
Malmo-based Perstorp announced capacity expansions earlier this year and in 2021. In April, the company said it would build a new plant at an existing site in Stenungsund, Sweden, doubling its carboxylic acids capacity to 140,000 metric tons by 2024. The stated goal was for Perstorp to use most of the additional output to makes it own finished products. The increased capacity was driven by the need to meet growing demand in high-value applications, including engineered fluids for refrigeration lubricants.
The company’s carboxylic acids used in fluids for refrigeration lubricants include valeric acid, 2-ethylhexanoic acid and isononanoic acid – the latter which the company began producing at the Stenungsund site in March.
In June 2021, the company said it begin increasing production capacity for 2-ethylhexanoic acid. Demand for the chemical had increased significantly in the preceding two quarters, as industries recovered and adjusted to the ongoing pandemic, the company said at that time.
Perstorp is also major producer of trimethylolpropane, known as TMP, and pentaerythritol, known as Penta. TMP is a polyalcohol commonly used in solvent-free coatings and in the production of synthetic lubricants, polyurethanes and alkyd resins. Penta is an alcohol made of molecules with four equally reactive primary hydroxyl groups in a symmetrical structure. According to Perstorp, this makes penta mono a desirable base polyol and building block for a variety of applications, like resins, synthetic lubricants and antioxidants.
The completion of the Perstorp acquisition is subject to relevant regulatory and shareholders’ approvals.