US-based speciality chemicals firm Cabot Corporation has entered into an agreement with Grupo Kuo S.A.B. de C.V. (KUOB.MX) to purchase the remaining 60% equity of its Mexican carbon black manufacturing joint venture, NHUMO, S.A.de C.V, for US$105 million, of which US$80 million will be paid upon closing, excluding cash acquired. Cabot has owned 40% of the joint venture since 1990. The plant has an annual capacity of 140,000 tonnes and is located in Altamira, Mexico.
NHUMO is the leading carbon black producer in Mexico, and the acquisition will strengthen Cabot’s global carbon black business. This strategic asset in Mexico will also serve to meet the growing demand for carbon black throughout North America. In fiscal 2012, the joint venture generated adjusted EBITDA of US$41 million. The acquisition is expected to close by the fall of 2013, pending regulatory approvals.
“This acquisition not only increases Cabot’s footprint in North America, but solidifies our global leadership position in the carbon black industry,” said Cabot President and Chief Executive Officer, Patrick Prevost. “This gives us expanded access to an important growth market in Mexico and immediate additional capacity to support the expansion of our customers in the U.S. Furthermore, it clearly demonstrates our ongoing commitment to delivering high quality products and services from local supply sources.”
With 18 plants globally, and capacity in excess of 2 million tonnes, Cabot is the world’s leading producer and marketer of carbon black..