Columbia-based W. R. Grace & Co. has entered into a definitive agreement to acquire the Fine Chemistry Services business (FCS) of Albemarle Corp. for approximately $570 million, including $300 million paid in cash at closing and $270 million funded through the issuance to Albemarle of non-participating preferred equity of a newly-created Grace subsidiary.
The acquisition significantly strengthens and expands Grace’s existing pharma portfolio. Pharma & Consumer is the largest, fastest growing and most profitable subsequent within Grace’s Materials Technologies business. FCS adds a comprehensive portfolio of high-value products and services with highly complementary analytical, regulatory and manufacturing capabilities to Grace’s existing pharma portfolio focused on chromatographic resins, formulation excipients and drug delivery, and pharmaceutical intermediates and active pharmaceutical ingredients (APIs).
“This acquisition is strategically and financially compelling and aligns perfectly with our strategy of building a higher growth portfolio by extending our existing capabilities into higher-growth, high-value end markets,” said Hudson La Force, Grace’s president and CEO.
The agreement has been unanimously approved by the Grace Board of Directors and is expected to close in the second quarter of 2021.
In addition, Moody’s has placed Grace’s ratings on review for downgrade. “The review for downgrade follows the announced acquisition of Albemarle’s Fine Chemistry Services business that further stresses credit metrics already weak for the existing rating category,” said Domenick Fumai, Moody’s vice president and lead analyst for Grace.