SI Group has signed a deal with Albemarle Corporation, a Louisiana-based chemical company, to acquire its antioxidant product lines and Ibuprofen and Propofol businesses.
“It’s the largest deal in SI Group’s history,” said President and CEO Frank Bozich in a news release issued Wednesday. “This acquisition is a natural fit to our expansion strategy, transforming SI Group into a solutions leader in the global antioxidant and pharmaceutical active ingredients markets.”
The deal expands SI Group’s antioxidants business and positions the Niskayuna-headquartered company as one of the top three global suppliers of Ibuprofen, an FDA-regulated drug that treats pain.
SI Group manufactures compounds and resins that appear in everyday objects like kitchen-utensil grips and automotive brake pads. It has a manufacturing plant in Rotterdam Junction, one of 20 facilities around the globe.
The recent transaction will add two manufacturing sites to its roster — one in Orangeburg, S.C., and one in Jinshan, China, as well as technical-support locations in Shanghai and Baton Rouge, La.
“This acquisition is a major step in SI Group’s strategy of expanding into complementary, faster growing markets while at the same time continuously improving our core business through business excellence,” said Stephen Haller, senior vice president of strategy and new business development.
It’s still subject to regulatory approvals, though, and isn’t expected to be completed until later this year.
SI Group’s board of directors recently approved a new strategic plan that would focus on “intelligent” expansion into markets that go along with the type of work that the company already is doing.
“The goal is to expand our offerings in our current markets,” said Bozich in an interview earlier this month. “We’re going to expand by finding complementary products and technologies and maybe even, ideally, regional companies that have complementary capabilities we can acquire and then globalize through our network.”
SI Group quietly completed two such acquisitions last year — one of a Korean company that manufactured biphenyls and one of a U.S. company that manufactured nonylphenols — that increased production volume at its Rotterdam Junction plant.
One example of what the company could achieve through this kind of expansion, Bozich said, comes from the company’s current manufacture of tackifiers, chemical compounds that help adhesives stick.
“We’re the largest tackifier supplier to the tire industry around the world right now,” he said. “We’re a global leader in that technology in the rubber industry, but we have a narrow product range. Because we have that channeled market, it’s very logical for us to want to find complementary or synergistic technologies so we can bundle them with the tackifiers and sell more to the same customers. And frankly, our customers are very excited about that.”