- Evonik Corp.
Evonik sells Lülsdorf site to ICIG marking 1st step in divestment of performance-materials division
Chemical company and biodiesel-catalyst manufacturer Evonik Corp. is selling its site in Lülsdorf, Germany, and the associated cyanuric-chloride business in Wesseling, Germany, to International Chemical Investors Group of Luxembourg.
The agreement was signed April 6. The parties have agreed not to disclose the purchase price.
Lülsdorf is a substantial part of the functional solutions business line within Evonik’s performance-materials division.
Transfer of ownership is scheduled for mid-2023. The closing of the transaction is subject to antitrust clearance and approval by the competent Evonik committees.
ICIG is an established Luxembourg-based chemicals investor. The company has approximately 4,800 employees and generated sales of around 4 billion euros (USD$4.37 billion) last year. It has extensive expertise in the development of sites and business units that no longer are part of the core business of other enterprises.
“We wanted a reliable investor that is able and willing to leverage Lülsdorf’s potential effectively, and that is what ICIG offers,” said Christian Kullmann, chairman of Evonik’s executive board. “For Evonik, that means we are taking the first step in the planned disposal of the three businesses in our performance-materials division. For the site, its employees, and the town of Niederkassel, the sale provides excellent options for future development.”
ICIG is taking over the entire site in Niederkassel-Lülsdorf, near Cologne, and the associated cyanuric-chloride business in neighboring Wesseling, including more than 600 employees and all production plants.
ICIG already has subsidiaries operating in chlorine chemistry and specialty chemicals and wants to expand the businesses in Lülsdorf and Wesseling.
“We are delighted to be adding these attractive sites to our portfolio and are planning extensive investments,” said Achim Riemann, managing director of ICIG. “The existing businesses are an excellent strategic fit with our focus.”
ICIG has given contractual assurances that the sale will not alter the rights of the employees at the sites.
“It’s good that our employees in Lülsdorf and the associated business in Wesseling will find themselves in established and experienced hands,” said Thomas Wessel, chief human-resources officer at Evonik. “That is, and always has been, our precondition in every divestment process.”
For example, the agreement excludes dismissals for operational reasons following the transaction until 2032.
“We have closely monitored the divestment process and got a first-hand impression of the future owner,” said Martin Albers, chairman of the General Works Council of Evonik. “It is common practice at Evonik to select investors who deal responsibly with employee rights. That also holds true in this case and will remain a prerequisite for the other parts of performance materials.”
In conjunction with the divestment of this site, Evonik is realigning the three businesses of the functional solutions business line.
With this sale, Evonik will completely divest the production of potassium derivatives and cyanuric chloride, which takes place exclusively in Lülsdorf and Wesseling.
As planned, Evonik is retaining the business with alkoxides for biodiesel, which are produced at two further sites apart from Lülsdorf. This business was integrated into the catalysts-business line in the smart-materials division effective Jan. 1.
ICIG will produce alkoxides at the Lülsdorf site exclusively for Evonik until 2027.
In total, the businesses to be divested generated sales of around 260 million euros (USD$283.8 million) in 2022.
Evonik started preparing the sale of the Lülsdorf site in fall 2021. The company is now realizing its preferred solution, selling the entire site to a new owner.
Plans by another investor to produce ethylene oxide in Lülsdorf had previously caused public concern.
The sale to ICIG marks the definitive end of these plans. Instead, ICIG intends to invest in facilities for renewable energies in addition to strengthening the existing production in Lülsdorf.