CCMP to sell chemicals firm to Carlyle for $1.5bn

The Carlyle Group is set to acquire a former JP Morgan Partners portfolio company, Niagara Holdings, from CCMP in a $1.5 billion transaction.

The Carlyle Group plans to add to its specialty chemicals portfolio, having agreed to acquire Niagara Holdings from CCMP Capital Advisors in a deal valued at $1.5 billion (€1 billion).

Niagara is the parent company of PQ Corporation, a maker of specialty inorganic chemicals, catalysts, and engineered glass products. JP Morgan Partners acquired Niagara in February 2005 for an undisclosed amount, and CCMP has managed the investment since spinning out from JPMP in 2006.

The transaction, subject to regulatory approval and customary closing conditions, is expected to close in the third quarter of 2007. Lehman Brothers and JP Morgan are PQ’s financial advisors, while Latham & Watkins is its legal counsel to PQ. Carlyle was advised by UBS Securities and Debevoise & Plimpton.

Like many private equity firms, Carlyle has already invested in the chemicals space. Last year, it invested in Stahl, a Dutch developer, manufacturer and distributor of specialty chemicals pertaining to leather processing, flexible materials coatings, paper and industrial colourants. Carlyle and Dutch buyout firm Oranje-Nassau Groep each paid €160 million to acquire the firm.