Ashland Inc. ASH has agreed to dispose its industrial biocides assets within its Specialty Ingredients unit to specialty materials maker – Troy Corporation – for an undisclosed price. Troy is a leading provider of microbial control products and performance additives.
Industrial biocides controls and prevents the growth of bacteria, mold and other microorganisms in a vast spectrum of coatings, construction materials and energy products. The business accounted for roughly 2% of the Specialty Ingredients unit’s revenues for the 12 months ended Mar 31, 2015.
The agreement with Troy does not include the preservatives products that are focused on consumer markets as Ashland is committed to retaining and growing that strategic business.
The transaction, which is subject to closing conditions and completion of required employee information and consultation processes, is expected to consummate within 60 days of the announcement.
The divestment is a part of Ashland’s strategy to dispose non-core assets and boost growth within its higher-margin core businesses that offer greater value to customers. On the other hand, the addition of the industrial biocides assets will strengthen Troy’s portfolio of preservatives and better place it to leverage the growth opportunities in this market segment.
Ashland offers specialty chemicals in more than 100 countries. After the sale of its Water Technologies unit last year, Ashland now has three commercial units – Specialty Ingredients, Performance Materials and Valvoline.
Ashland is a Zacks Rank #3 (Hold).
Better-ranked companies in the specialty chemicals space include Ferro Corporation FOE, Flexible Solutions International Inc. FSI and Chemtura Corporation CHMT. While Ferro sports a Zacks Rank #1 (Strong Buy), Flexible Solutions and Chemtura hold a Zacks Rank #2 (Buy).
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