December 2, 2014 / 5:30 PM / 4 years ago

Exclusive: Arizona Chemical seeks more than $1.5 billion in sale - sources

(Reuters) - Arizona Chemical Holdings Corp, the largest producer of pine chemicals used in fragrances, plastics and household cleaners, is exploring a sale that could value it at over $1.5 billion, including debt, according to people familiar with the matter.

Private equity firm American Securities LLC, the majority owner of Arizona Chemical, has interviewed investment banks in recent weeks to appoint a financial advisor on the sale of the company, the people said this week.

Arizona Chemical has annual earnings before interest, tax, depreciation and amortization of around $200 million, the people added.

The sources asked not to be identified because the deliberations are confidential. American Securities declined to comment, while Arizona Chemical did not respond to requests for comment.

Based in Jacksonville, Florida, Arizona Chemical also makes natural pine-based materials for adhesives, roads and construction, tires and rubber, lubricants, fuel additives and the mining sectors.

Founded in 1930, Arizona Chemical was sold to American Securities in 2010 by buyout firm Rhone Capital LLC for just over $790 million, including fees and expenses. Rhone Capital retained a 25 percent stake in the company.

Arizona Chemical had revenues of $989 million in the 12 months to the end of March, according to Moody’s Investors Service Inc. Last summer, its private equity owners had the company add to its debt pile so it could pay out a $410 million dividend, the fourth time they have done so since 2010.

The company has ten chemical manufacturing plants located in the United States, Britain, France, Germany, Sweden and Finland.

Reporting By Mike Stone and Greg Roumeliotis in New York; Editing by Chris Reese

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