Contract speciality chemical maker Chemspec International says it will ‘go private’ after being taken over by Halogen Limited, a holding company co-owned by members of its management board.
Under the deal Shanghai, China-headquartered Chemspec will become a wholly owned, Cayman Island-based subsidiary of Halogen, which is owned by company chairman Jianhua Yang, board members Weinian Qi and Yunlong Yuan and Primavera Capital Fund.
The move, financial details of which were not disclosed, will also see the contract chemicals manufacturer leave the NYSE’s Euronext list of Chinese companies which it joined in the summer of 2009.
Chemspec, which supplies chemicals and provides process design and development services to companies in the pharmaceutical, agrochemical and electronics industries, detailed plans for the acquisition in a Securities and Exchange Commission (SEC) filing in March .
Completion of the merger, which was approved by shareholders at a meeting held earlier this month, follows Chemspec’s publication of a fairly lacklustre set of financial results for the quarter ended March 31.
Revenue for the period was $32m (€22m) down 5 per cent on the comparable quarter in 2010, while net income fell 56.8 per cent to $3.5m.
Chemspec has not said whether the decline in revenue and income in the quarter, which continued the trend seen in the full year 2010, had played any part in its decision to delist.
The firm, whose drug ingredient production operations are at a facility in Wei Er Jiangsu, claims to supply a number of medium and large sized companies in the pharmaceutical sector and that the majority of its products are exported to Europe, the US and Japan.
It also sells fluorinated specialty chemicals to a number of international pharmaceutical companies for use in a number of United States Food and Drug Administration (FDA)-approved drugs.