KKR Nears Deal for Specialty-Chemicals Maker Chase

Private-equity firm KKR is nearing a deal to acquire specialty-chemicals company Chase for roughly $1.3 billion including debt. 

A deal could be reached as soon as Friday, assuming the talks don’t hit a last-minute snag, people familiar with the matter said. 

The Wall Street Journal reported in June that Chase was working with financial advisers on a possible sale that has drawn interest from private-equity firms and industry players. 

Chase has a market capitalization of roughly $1.2 billion. The stock closed Wednesday at $123.50, not far off a 52-week high of $131.82, pushed up by hopes for a deal.

The exact per-share price for the potential deal couldn’t be learned.

Chase manufactures products for three business segments: adhesives, sealants and additives; industrial tapes (its largest segment by revenue in fiscal 2022); and corrosion protection and waterproofing, according to its website. Its materials are used across industries including autos, construction and electronics. 

The company has said it anticipates a number of tailwinds for its business, including a boom in infrastructure spending across North America, consumer-device upgrades and enhancements to power grids and solar and wind turbines. 

Chase reported year-over-year revenue growth of 20.3%, to $106.6 million, in the three months ended May 31. 

The company, founded in 1946, has grown in recent years through a number of acquisitions. Last year, it bought NuCera Solutions, a producer of high-end polymer technologies, for about $250 million. Since 2016, it has completed a total of nine deals. 

KKR last month struck a deal to buy pump-and-valve maker Circor International for $1.8 billion including debt. 

Both deals count as relatively large leveraged buyouts at a time when financing has become harder to come by and more expensive. Banks had largely been sidelined as they struggled to sell off debt they underwrote before the market downturn. 

However, the situation has recently improved. Banks, for example, provided more than $8 billion in leveraged loans for GTCR’s purchase of a stake in Fidelity National Information Services

Many buyers continue to tap the private-credit market to finance their deals, though. 

Based in New York and with offices around the world, KKR manages more than $500 billion across strategies including private equity and credit. 

The firm has been a leader in a push to give stock in companies to more rank-and-file employees and has been rolling out such broad-based ownership across its private-equity portfolio. 

Write to Lauren Thomas at [email protected] and Laura Cooper at [email protected]