Ashland completes ISP acquisition
Combined unit to be called Ashland Specialty Ingredients
Ashland Inc has today completed its acquisition of privately owned International Specialty Products Inc (ISP) in an all-cash $3.2bn transaction, subject to post-closing adjustments for changes in net working capital and certain other items.
“This defining transaction is expected to be immediately accretive and will significantly expand our position in higher margin, higher growth end markets, including personal care, pharmaceuticals, food and beverage and energy,” said James J O’Brien, Ashland chairman and ceo. “We are excited about combining ISP’s technologies and capabilities with our own. This acquisition enhances our ability to satisfy the increasing global demand for more technologically advanced consumer and industrial products, and to continue to generate industry leading innovation and solutions for our customers.”
ISP will be integrated into the Ashland Aqualon Functional Ingredients commercial unit, which will more than double the size of Ashland’s highest margin business. The combined unit, which is effective immediately, will be called Ashland Specialty Ingredients and is expected to contribute about half of Ashland’s EBITDA. It also means around half of Ashland’s overall revenues will now come from outside North America.
John Panichella, president of the new Ashland Specialty Ingredients business is leading an integration team with key representatives of both companies. The company says it anticipates making approximately $50m in annual run-rate savings by the end of the second year through eliminating redundancies and making operational efficiencies.
“The addition of ISP greatly expands the breadth of our technology platforms and provides new resources and capabilities to better capitalise on market opportunities,” said Panichella. “In particular, we now can offer our customers one of the broadest, most functional portfolios of water-soluble polymers in the world.”