Elkem ASA acquired Basel Chemie, a Korean producer of specialty silicone gels for cosmetics and water repellents for the construction industry for $26.9 million. The acquisition gives Elkem access to leading technology in attractive end-user silicone segments and provides a solid platform for further development and growth, according to the company. Basel Chemie was founded in 1999 and has a state-of-the-art plant near Gunsan and a new research and development and office center in Seoul. The company has 32 employees and 2018 sales of $7.7 million and an average EBITDA margin of 28% during the past three years. Basel is a technology driven downstream silicones producer with a high-end speciality portfolio for both skin care and color cosmetic applications, and water repellents for the construction industry, according to Elkem.


"This acquisition strengthens our position in downstream specialized silicones. Basel Chemie complements our market offering and brings additional technologies to our specialty portfolio in Asia where we have strong positions in other segments. This technology and offering also holds further global potential. Acquiring Basel Chemie is in line with our strategy to take further positions in selected, specialized silicone segments," said Helge Aasen, CEO of Elkem.


Elkem will boost Basel Chemie’s specialties through Elkem’s global sales and distribution network, including access to and integration with offerings to current customers and new markets where Elkem is present. Basel Chemie will make Elkem a more comprehensive and attractive supplier within the cosmetics segment, and has an attractive product offering within building protection which can be leveraged outside Korea. The two companies will strengthen their research and development in both Asia and Europe and integrate their value chains.


“Elkem expects to generate strong synergies from the acquisition within research and development, value chain optimization, complementary product offerings and global market positions. Basel Chemie’s leading position and technologies will reinforce our silicones portfolio for the personal care industry where Elkem has global reach and complementary products. The company has a strong specialties position in the fast-growing innovative Korean cosmetics market, and we will get several synergies of integrating the global marketing offerings. In the building protection segment Elkem holds market positions outside of Korea with significant potential for Basel Chemie’s offering," says Frederic Jacquin, SVP Elkem Silicones, a Bluestar company.


The acquisition is subject to final regulatory approvals. Closing is expected by the end of September 2019.