Dec 1, 2021
Czech Chemicals Firm Draslovka Sees Rapid Growth After Chemours Unit Deal
, Bloomberg News
(Bloomberg) -- Czech chemicals producer Draslovka AS is creating the world’s biggest producer of solid sodium cyanide through an acquisition in the U.S. and it expects to triple the size of the business over a decade.
The purchase of the Mining Solutions unit from Chemours Co. for $521 million will create “very strong growth opportunities” for Draslovka, its Chief Executive Officer Pavel Bruzek said in an interview on Wednesday. The expansion will give the Czech supplier to the mining and agriculture industries access to cheaper raw materials and a bigger market in the U.S.
Following the transaction, the combined entity will have over $350 million in sales, of which about 75% will come from the Mining Solutions business. Draslovka expects the Ebitda margin to grow to 30% from the current about 25%, and aims to reach revenue of $1 billion in 10 years.
“We were looking for the best party on the market to acquire,” said Bruzek. “We can complement our technology and infrastructure and knowledge, and the portfolio of new products, with their knowledge of the market and their amazing access to very cheap raw materials.”
Before the acquisition, Draslovka had production and services facilities in the Czech Republic, South Africa, Australia, New Zealand and India. In July, the company agreed to buy Sasol Ltd.’s sodium-cyanide business for 1.46 billion rand ($91 million), and Bruzek says he is “very confident” to overcome regulatory hurdles that are currently holding up that transaction and complete the deal.
Mining Solutions is one of the largest North American producers of solid sodium cyanide, a key component for the extraction of gold and silver from mined ores.
Founded in 1906, Draslovka is currently jointly owned by four Czech families and adds to the list of the country’s industrial companies that have recently expanded to the U.S. Earlier this year, Czech firearms producer Ceska Zbrojovka Group SE bought the iconic Colt Holding Company LLC to meet rapidly growing demand in the key North American market.
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