| NEW YORK, June 3
NEW YORK, June 3 American Securities LLC is in
advanced talks to acquire specialty chemicals company Emerald
Performance Materials LLC from private equity peer Sun Capital
Partners Inc for more than $1 billion, people familiar with the
matter said on Tuesday.
The deal underscores private equity's affinity for specialty
chemicals companies, which can have higher margins and be less
susceptible to economic swings than companies in the wider
New York-based American Securities prevailed over other
buyout firms in the auction for Emerald Performance, the people
said, cautioning that the deal had not yet been finalized.
The sources asked not to be identified because the
negotiations are confidential. Sun Capital declined to comment,
while American Securities and Emerald Performance
representatives did not respond to requests for comment.
Emerald Performance, based in Cuyahoga Falls, Ohio, produces
chemicals used in food flavorings and fragrances as well as
Boca Raton, Florida-based Sun Capital created Emerald in
2006 out of businesses it bought from Lubrizol Corp, a chemicals
maker specializing in lubricants for engines. Warren Buffett's
Berkshire Hathaway Inc took over Lubrizol for $9
billion in 2011.
Lubrizol said in a regulatory filing in 2006 the sale of
the businesses that would become Emerald Performance resulted in
cash proceeds of about $269.7 million. Accounting for the debt
of Emerald Performance both at the time of its creation and its
impending sale, Sun Capital stands to make more then nine times
its money on the deal.
American Securities is itself no stranger to the chemical
sector. Last December, it agreed to sell General Chemical Corp
to Canada's Chemtrade Logistics Income Fund for $860
(Reporting by Greg Roumeliotis in New York; Editing by Steve