PHOENIX (Nov. 17, 2005) — U.S. carbon black maker Columbian Chemicals Co. is being bought by an investment company jointly owned by DC Chemical Co. Ltd., a South Korean chemical maker, and a private equity affiliate of JPMorgan Chase & Co.
Phoenix-based Phelps Dodge Corp., the diversified mining and engineering concern that owns Columbian, has agreed to sell the carbon black producer to Columbian Chemicals Holdings L.L.C. for about $600 million.
Marietta, Ga.-based Columbian is considered the third-largest carbon black maker in the world, after Cabot Corp. and Degussa Engineered Carbons L.P. Carbon black is a petroleum-derived substance that is used to cross-link rubber during vulcanization, giving it its durability and its familiar black hue.
Columbian has 12 plants around the world with annual capacity of about 1.1 million tons.
DC Chemical has two carbon black plants in South Korea, each with a capacity of 100,000 metric tons a year. Products are sold under the trade name Dash Black.
In a filing with the Korean stock exchange, DC said it is setting up Columbian Chemicals Holdings to acquire all the shares in Columbian owned by Phelps Dodge. The equity will be split 2:1, with DC Chemical owning the two-thirds controlling share and One Equity Partners, the JP Morgan affiliate, the minority share.
The transaction is subject to customary closing conditions, including regulatory approvals, according to Phelps Dodge, which said it expects to report an after-tax loss on the sale of about $60 million.