The Eastman Chemical Company agreed on Thursday to buy the Taminco Corporation, a maker of specialized chemicals, for $1.7 billion in cash, becoming the third owner of the company in the last three years.
Under the terms of the deal, Eastman will pay $26 a share, nearly 9 percent above Taminco’s closing price on Wednesday. Including the assumption of Taminco’s debt, the transaction is valued at $2.8 billion.
Taminco, which makes niche chemicals like alkylamines for agriculture, water treatment, and oil and gas companies, went public last year under the control of Apollo Global Management, which bought the company in 2011 for $1.4 billion from another investment firm, CVC Capital Partners.
Apollo, which owned a stake of nearly 54 percent as of June 30, has agreed to vote in favor of the deal.
By buying Taminco, Eastman said it would bolster its offerings in the food, feed and agriculture industries, as well as yielding about $60 million in cost savings, or 5 percent of Taminco’s 2013 revenue.
“The acquisition of Taminco demonstrates Eastman’s continued commitment to accelerating growth throughout the company and around the globe,” Mark J. Costa, Eastman’s chairman and chief executive, said in a statement. “As a specialty chemical company with consistent earnings growth and leading positions in attractive niche end markets, Taminco is a strong fit with Eastman’s strategic focus.”
Taminco will have 30 days to try to find a better offer through what is known in deal parlance as a “go shop” period. The transaction is expected to close by year end.
Citigroup and the law firm Jones Day advised Eastman, while Morgan Stanley and the law firm Kirkland & Ellis advised Taminco.