Singapore-listed Keppel Infrastructure Trust (KIT) on Thursday announced that it will acquire Australian chemical firm Ixom HoldCo Pty Ltd for A$777 million ($565 million).
The sellers are funds managed by Blackstone Group and management shareholders. The deal puts Ixom’s enterprise value at A$1.1 billion ($799.5 million).
The acquisition is expected to be completed in Q1 of 2019, subject to necessary approvals, including from the Australian Foreign Investment Review Board and the New Zealand Overseas Investment Office.
Ixom manufactures and distributes water treatment products and other chemical products. Upon completion of the transaction, KIT’s enlarged portfolio will grow from S$3.8 billion to S$5.1 billion, it said in its SGX disclosure.
“The Ixom Group’s business model is aligned with KIT’s investment strategy to acquire industrial infrastructure assets that generate long-term stable cash flows with potential growth. The Ixom Group’s value proposition extends KIT’s capabilities into the water treatment chemicals sector in Australia and New Zealand,” KIT said in a separate statement.
The acquisition will initially be funded through a bridge facility of up to S$750 million ($544.8 million) and a five-year term loan of A$532 million ($386 million), which will also be used to pay off an existing Ixom loan of A$432 million ($313.5 million).
KIT said it intends to repay the debt from proceeds raised through an equity fundraising. The fundraising, the timing of which will be decided at a later date, could be a preferential offering, a rights issue, a private placement or a combination of two or more of these.
Blackstone bought Orica’s chemical business for A$750 million ($536 million) in 2015 and renamed it as Ixom. The Aussie firm’s water treatment and chemical distribution business is largely focused on the Australia and New Zealand markets.