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HIG Capital nears deal to buy Ferro Corp unit

  • Ferro Corp selling Polymer Additives unit
  • Unit has revenue of about $230 mln
  • Deal expected to fetch 7x to 8x EBITDA

The unit of the publicly traded chemical firm generates about $230 million in annual revenue, with EBITDA of about $25 million, according to the sources.

The sale of the Polymer Additives business is expected to draw a purchase price multiple of 7x to 8x EBITDA, or about $175 million to $200 million.

An H.I.G. Capital representative declined to comment. A spokesperson for Ferro Corp did not respond to requests for comment.

The sale of the Polymer Additives unit is being handled by KeyBanc Capital Markets of Cleveland.

Ferro Corp disclosed the sale without mentioning the name of the buyer in its third-quarter financial report. The deal would complete the divestiture of its performance chemicals portfolio, the report said.

The Polymer Additives unit provides technical solutions for PVC, polyolefin, urethanes, polystyrene and rubber products. Its markets include adhesives, caulks and sealants, agricultural chemicals, antimicrobials and biostabilizers, and color concentrates, according to the Ferro’s website.