* Cash deal with Mexico's Mexichem
* Deal close likely in during Q1 next year
* Says sale will enhance adjusted EBITDA margins
Dec 17 (Reuters) - Specialty chemicals company Rockwood Holdings Inc ROC.N agreed to sell its AlphaGary plastic compounding business to Mexico's Mexichem (MEXCHEM.MX) for $300 million in cash to reduce debt.
Princeton, New Jersy-based Rockwood expects the deal to close during the first quarter of next year.
The company has long-term debt in excess of $2 billion.
"This sale will further enhance our overall adjusted EBITDA margins, improve leverage ratio and help maximize shareholder value," Rockwood Chief Executive Seifi Ghasemi said in a statement.
AlphaGary, the largest division in Rockwood's specialty compounds segment, manufactures specialty plastic compounds for the wire and cable business.
The specialty compounds business contributed over 7 percent to its turnover last year.
Share of the company, which have gained 32 percent in value in the last three months, closed at $40.06 on Thursday on the New York Stock Exchange. (Reporting by Krishna N. Das in Bangalore; Editing by Prem Udayabhanu)