Lonza Group AG, the world’s biggest maker of drug ingredients, agreed to buy Arch Chemicals Inc for $1.2 billion in cash to create the world’s biggest microbial-control business.
Lonza will pay $47.20 a share, 12 per cent higher than the closing price on July 8, the Basel, Switzerland-based company said in an emailed statement today. Shares of Norwalk, Connecticut-based Arch surged 11 per cent on July 8, the most in 14 months.
Arch’s products are used to kill microbes in swimming pools, protect wood from fungus and to deter the growth of mold and mildew in paint. The deal will make Lonza the leader in a market valued at $10 billion that’s growing as much as six per cent a year, and allow the Swiss company to expand its non-pharmaceutical business, Lonza said. “Lonza and Arch Chemicals offer highly complementary products and technologies and together will be the global leader in controlling unwanted microbes,” Lonza Chief Executive Officer Stefan Borgas said in the statement. “The business will be a strong platform for accelerated future growth.”
Lonza fell 75 centimes, or 1.1 per cent, to 66.05 Swiss francs at 9.05 am in Zurich. Before today, the stock had fallen 8.2 per cent this year, giving the company a market value of 3.5 billion francs ($4.2 billion)
