Chemicals manufacturer Pentagon snapped up by US group

AN INDEPENDENT North West chemicals manufacturer with operations in Widnes and Workington, has been sold to an international group headquartered in the US.

Pentagon Chemical Holdings, which has 180 staff at its two sites and annual sales of nearly £51m, has been acquired by Vertellus, a private equity-backed group, for an undisclosed sum.

The sale on behalf of Pentagon’s shareholders – its directors – was led by corporate finance firm Clearwater International.
 
Pentagon has been operating since 1939 on its site at Halebank, Widnes since 1975 at Workington site, producing fine chemicals and intermediates for the crop chemicals, oilfield, paper and pharmaceutical industries.

In the year to the end of July 2013, sales rose 17% to £50.8m and pre-tax profits surged 81% to £2.6m.

Prior to the sale the business was run by chief executive Allan Laing, who led a management buyout from Dow in 2002 and then acquired the UK fine chemicals business from Great Lakes.  He owned just less than 60% of the company and has now retired.

The new owner makes specialty chemicals for the agriculture, coatings, medical, nutrition, personal care, pharmaceuticals and plastic industries. The Indiana-based business is backed by US private equity firm Wind Point Capital Partners.  It already has UK operations in Hampshire and Middlesbrough.
 
The Pentagon acquisition will allow Vertellus to csignificantly increasing market share across Europe.

The Clearwater International team was led by Manchester-based partners Constantine Biller and Philip Nuttall, with support from director Nick Horrocks.
 
Mr Biller said: “Vertellus’ acquisition of Pentagon is a fantastic achievement for the company’s shareholders. Pentagon’s key position in the industry makes it a great strategic deal for the US group.
 
“In addition, Pentagon will expand Vertellus’ manufacturing footprint and add additional, high-value chemistries to its portfolio. This transaction also allows Pentagon to move to the next stage in its already firm position in the market.”