Elkem ASA has acquired Polysil, a silicone elastomer and resins material manufacturer to boost specialized silicone pressure sensitive adhesive (PSA) and resin business in China and globally.
Strengthening Business in Specialized Silicones Segment
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We continue to develop Elkem’s competitive positions, at the same time as we work to safeguard our business in light of the coronavirus situation. The financial closing of the Polysil acquisition represents an important milestone, strengthening our position in specialized silicones segments in China, in line with our growth and specialization strategy. Today’s macro environment highlights the value of being a global specialty player across regions,” said Michael Koenig, chief executive officer of Elkem ASA.
Approximately 90 percent of Polysil's revenues are generated in China, primarily in South China. Elkem's capabilities and positions in other parts of China and internationally provide a solid platform for Polysil's products and further growth. Elkem’s production in China is back around normal capacity levels, after experiencing delayed start-up after Chinese New Year due to the coronavirus situation.
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Polysil's products and market positions in food, baby care, electronics and medical markets are complementary to Elkem. There is significant potential in utilising Polysil's high-end liquid silicones rubber and pressure sensitive adhesives specialty positions and in further developing both products and markets. Polysil's strong research and development capabilities will be very important for development of products for both the Chinese market and globally. This continues also in the current macro environment,” said Frederic Jacquin, senior vice president for Elkem’s Silicones division.
Best Technology for Manufacturing Pressure Sensitive Adhesives
Polysil has one of the leading technology positions in production and development of Heat Cured Rubber (HCR), Liquid Silicone Rubber (LSR) and specialty resin and Pressure Sensitive Adhesives (PSA). Polysil has two production facilities and a research and development centre.
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Polysil is excited to join the Elkem family. The management team of Polysil is very pleased to stay with the company in the next stage. We are confident to further develop and integrate our business with Elkem’s worldwide platform, bring more value to our customers, and create a brighter future together,” says Hanyong Ma, the current and future general manager of Polysil.
The transaction was announced 30 December 2019. In 2019, Polysil delivered a total operating revenue of RMB 624 million with earnings after tax of RMB 95 million. The companies have agreed an enterprise value for Polysil of up to RMB 941 million, including potential earn-out dependent on pre-agreed parameters.
All regulatory approvals for the acquisition have been concluded and the settlement of the transaction took place 1 April 2020. Polysil will be consolidated into Elkem's financial statement with effect from 1 April 2020.
Source: Elkem