Fort Worth-based KMG, a global provider of specialty chemicals, on Jan. 31 announced it has agreed to acquire privately-owned Sealweld, a leader in the industrial lubricants market, for $17.4 million in cash, including estimated net working capital of approximately $4.5 million. KMG, which trades on the NYSE under the KMG symbol, drew on its revolving credit facility to finance the acquisition.
Sealweld is a leading global supplier of high-performance products and services for industrial valve and actuator maintenance, including lubricants, sealants, cleaners, valve fittings, tools and equipment. The company is based in Calgary, Alberta, Canada, with additional facilities in the United States and the United Arab Emirates, Founded in 1969, Sealweld provides routine and emergency valve maintenance services and technician training for many of the world’s largest pipeline operators., Sealweld generated revenue of approximately $12 million and reported EBITDA of $2.6 million for the trailing 12-month period ending September 2016.
“We are excited to announce the acquisition of Sealweld and we welcome its valued team to KMG,” said Chris Fraser, KMG’s chairman and CEO.”This acquisition strengthens and enhances our industrial lubricants business, adding a complementary suite of products and services backed by the widely known and respected Sealweld brand name. Serving major pipeline operators in Canada, the United States, Europe, the Middle East and Asia, Sealweld significantly expands our presence and customer reach in the global industrial valve maintenance market, while broadening our participation and growth opportunity in key areas such as valve maintenance services and training. Sealweld is immediately accretive to KMG’s adjusted EBITDA and adjusted earnings per share,”
Dean Chisholm, CEO of Sealweld Corp. said that, as part of KMG, “Sealweld will leverage KMG’s global capabilities and resources to further strengthen Sealweld’s market presence in key geographic regions and more efficiently serve customers on a global scale.”