November 15 2018, David R Brown
Singapore's Keppel acquires Australian Chemical firm Ixom from Blackstone for AUD 777 million
Keppel Infrastructure Trust (KIT) has annouced that it is to acquire Australian chemical distributor and manufacturer Ixom HoldCo Pty Ltd for AUD 777 million (about USD 565 million) in a deal that values the business at AUD 1.1 billion (about USD 799.5 million). The acquisition is expected to be completed in Q1 2019, subject to necessary approvals, including from the Australian Foreign Investment Review Board and the New Zealand Overseas Investment Office.
Ixom Group's business model is aligned with KIT's investment strategy to acquire industrial infrastructure assets that generate long-term stable cash flowsMatthew Pollard
CEO Keppel Infrastructure Fund Management Pte. Ltd.
The deal was made with the management shareholders and funds from Blackstone Group, who paid AUD 750 million (about USD 751.43 million) for the business back in 2014, which was then part of Orica.
Ixom, with its subsidiaries Ixom Group, manufactures and distributes water treatment products, as well as specialty chemicals for industries including agriculture, mining, and construction. Its facilities are located in Australia and New Zealand, with dedicated third party bulk tankers in selected regions.
“The chemicals that Ixom manufactures and distributes are needed for daily life and many business,” said KIFM CEO Matthew Pollard. “It is also a sector we are familiar with given KIT uses many of the major chemicals manufactured and distributed by Ixom in our water desalination and wastewater treatment assets. The Ixom Group's business model is aligned with KIT's investment strategy to acquire industrial infrastructure assets that generate long-term stable cash flows with potential growth. Ixom’s value proposition extends our capabilities into the water treatment chemicals sector in Australia and New Zealand”
The acquisition will be funded through a bridge facility of up to SGD 750 million (about US$544.8 million) and a five-year senior term loan of AUD 532 million (about USD 386 million). KIT also intends to later repay the debt from proceeds raised through an equity fundraising, which nature and timing will be decided at a later date. Sponsor Keppel Infrastructure Holdings, which is wholly owned by Keppel Corp, has undertaken to take part in the equity fund-raising to maintain its 18.2%.
About Keppel Infrastructure Trust (KIT)
Keppel Infrastructure Trust (KIT) is a Singapore-listed business trust that provides investors with the opportunity to invest in a large and well-diversified portfolio of core infrastructure assets located in jurisdictions with well-developed legal frameworks that support infrastructure investment. The Trust aims to provide long-term, regular and sustainable distributions to its Unitholders.
Source(s): KIT Press Release