Private Equity News & Analysis

CBPE in 3.5x chemicals exit

The chemicals sector is proving fruitful for Close Brothers Private Equity. It has completed its second deal in a month, selling BWA Water Additives to Bahrain-based investment bank United International.

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UK mid-market investor Close Brothers Private Equity has sold BWA Water Additives to United International Bank, an investment bank based in Bahrain. Financial details were not disclosed, but CBPE said the sale generated a return of 3.5x on its original investment.

CBPE carved the industrial water chemicals business out of its US-listed parent Chemtura Corporation in 2006 for $85 million. As part of the deal, CBPE acquired the sales, marketing, technology and supply chain assets from Chemtura, and renamed it BWA Water Additives.

BWA: new capital
flows in from
Bahrain

BWA has headquarters in Manchester in the UK and Atlanta in the US, and operates in around 80 countries worldwide generating revenues of $120 million (€84 million). Its products are principally used to control the build up of scale and corrosion and to treat microbiological growth in water.

At the end of August this year CBPE backed the £129 million management buyout of Warwick International, a producer of an agent used in laundry and dishwasher products.

Iain Slater, the partner at CBPE who led the BWA deal, underlined the firm’s commitment to the sector. “We will be looking for more investments in the specialist chemicals sector – a key area of focus for us,” he said.

Finance was provided by the Royal Bank of Scotland, HSBC and Royal Bank of Scotland Equity Fund, and the transaction was structured in accordance with Sharia principles. UIB was advised by law firm Stephenson Harwood.