Chinese life sciences company Lianhe Chemical Technology Company (Lianhetech) agreed to buy Middlesbrough-based chemicals manufacturer Fine Industries from Manchester-based private equity firm NorthEdge Capital and Fine Industries management for about £103 million.
NorthEdge said the Shenzhen-listed company is China’s leading chemical contract manufacturer with a stock market value of about £2 billion and revenues in excess of $600 million.
NorthEdge said Seal Sands-based Fine Industries, which employs 220, would become Lianhetech’s European base, allowing it to operate in closer proximity to its customers and markets in crop protection, pharma and performance chemicals.
Fine Industries delivered turnover of £52 million and EBITDA of £10 million in the year to September 2016.
Lianhetech CEO Maggie Wang said: “The acquisition provides the geographic presence, capability and expertise needed to develop new products and better utilise Lianhetech’s state-of-the-art technologies for our customers worldwide.”
NorthEdge Capital partner Ray Stenton said: “Fine Industries is a high-quality UK based chemical research and manufacturing company with a highly skilled workforce.
“The business sells globally, it is an exceptionally well-invested asset and a highly trusted partner by its customer base.
“These qualities along with the strength of the management team, make this an ideal platform for Lianhetech’s European expansion plans.
“As Lianhetech’s first investment outside of China, this represents a significant strategic development and sign of their future ambition.”
Fine Industries CEO Chris Gowland said: “Becoming part of the Lianhetech team is a very exciting opportunity for Fine Industries and we feel privileged that they have selected our business to be the platform for their European expansion strategy.
“The brand and reputation of both Lianhetech and Fine Industries are well known and respected in the chemical manufacturing industry and I expect the union of the companies to further strengthen our position in the global market.”
The transaction is subject to regulatory approval.
NorthEdge and Fine were advised by PwC and Addleshaw Goddard. Lianhetech was advised by EY and Travers Smith.