KMG Acquires Valve Specialist


KMG Acquires Valve Specialist

KMG Chemical Inc. acquired Sealweld for $17.4 million, declaring that the Canada-based valve specialist will help to expand its industrial lubricant offerings.

The company said it made the $17.4 million acquisition – which includes $4.5 million in working capital – using funds drawn from a revolving credit facility on Jan. 31. With this acquisition, KMG will gain Sealwelds primary facility, and headquarters, in Calgary, Alberta, Canada and additional facilities in Houston, Texas and Sharjah, United Arab Emirates.

KMG Chairman and Chief Executive Officer Chris Fraser said the acquisition will help KMG to dive further into the industrial lubricants market. Fraser believes the addition of Sealweld into the KMG team will help to enhance a platform established in 2015 with the acquisition of valve lubricants and sealants supplier Val-Tex.

Sealweld is currently known world-wide for its valve training programs and services, which includes emergency and routine valve maintenance, which Fraser believes will compliment Val-Texs products.

Sealweld focuses on providing services and training and education to pipeline operators, with Sealweld products sold to customers in conjunction with its services, Frasier said during an interview. This approach is complimentary to Val-Tex, which focuses on selling valve maintenance products to end users and valve manufacturers. Fraser cited Sealwelds valve maintenance services and training programs as a way to step further into the market without conflicting with what Val-Tex already offers.

Because Sealweld is already a well-known presence in the market, the brand identity and product offerings will remain the same after the acquisition. While KMG will leverage Sealwelds strengths against Val-Texs, customers can expect little change in day-to-day operations.

Dean Chisholm, Sealwelds chief executive officer, will stay with the company as a consultant in an effort to maintain consistency. Deans deep expertise and knowledge of the pipeline services market will be of great value as we grow and expand our industrial lubricants business, Fraser said. He also noted Sealwelds management team will continue to lead the company.

Photo: iStock/SergBob

Related Topics

Business    Finished Lubricants    Mergers & Acquisitions