Quaker Houghton CEO Michael Barry promised growth through acquisition.
Just four weeks after its formation, when Conshohocken-based Quaker Chemicals merged with Norristown-based rival Houghton International, the company has delivered on that promise. Quaker Houghton said Thursday that it will pay £80 million, or about $98 million, for the specialty-chemicals operations of U.K.-based Norman Hay Plc.
The deal is expected to boost Quaker Houghton sales, currently $1.6 billion a year, by around $78 million, and add almost $14 million in profits. The transaction is set to close in October pending approval by European regulators.
Hay’s brands include Ultraseal sealants, SIFCO ASC metal-plating, Surface Technology coatings, and Norman Hay Engineering, for aerospace, auto, energy, electric-power and robotics companies.
It would be expensive for Quaker Houghton to try to compete in those markets directly, Barry said in a statement. He added that industrial trends “such as the light-weighting of vehicles and 3-D printing" gives Quaker Houghton new opportunities to boost sales using Hay’s engineering assets.
Hay, based in Coventry, England, was started in 1946. The move adds around 400 people to Quaker Houghton, whose businesses employed around 4,000 before the merger.
Barry promised investors he would cut $60 million in costs to make the $1.4 billion Houghton acquisition more profitable. That deal took more than two years to complete, after European regulators required the companies to divest some business units to France-based Total.