LONDON (CNI)--Dutch group Akzo Nobel said Thursday it has agreed the sale of its Acordis fibres business to a consortium led by CVC Capital partners for Euro825m ($851m).
Venture capital company CVC will have a 64% equity stake, with the Acordis management holding 15%. Akzo Nobel will acquire the remaining 21%.
Acordis, which will retain its existing management under chief executive Folkert Blaisse, also inherits from Akzo Nobel provisions of some Euro225m to meet various obligations including pension fund payments and environmental charges.
Akzo Nobel said Acordis would be a Dutch company and have a two-tier board structure with a supervisory board in which Akzo will have one of the five seats.
Cees van Lede, Akzo Nobel chairman, described completion of the sale negotiations as a major milestone for his group. "Akzo Nobel will enter the next century as a different company - focusing on the dynamics of growing our pharma, coatings and chemicals businesses."
Folkert Blaisse said Acordis will focus on building a solid stand-alone fibres company with high potential for the future.
In August, when the CVC offer was first announced, Blaisse said Acordis planned to achieve a return on sales of at least 8% in the next three to five years by restructuring and focusing on the high growth areas of industrial applications and specialty fibres. In the first quarter this year the return on sales was 1%.
CVC has publicly backed the Acordis management's strategy of growing organically and through add-on acquisitions in core markets. Earlier this year CVC completed the purchase of 75% of Dynoplast, the plastics business of Norway's Dyno Industrier and the acquisition from Shell of a 50% stake in Dutch plastic pipe manufacturer Wavin.