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Specialty chemicals company Chemtura Corporation has completed the sale of its Consumer Products business to Toronto, Canada-based KIK Custom Products Inc. (“KIK”) on Dec 31, 2013, for an adjusted purchase price of $300 million.

Chemtura sold Lawrenceville, Ga.-based BioLab's pool products businesses in North America, South Africa and Australia/New Zealand as well as its European division, known as Bayrol. It also divested household care business in North America and manufacturing plants in Conyers, Ga.; Lake Charles, La; and Atlantis, South Africa.

Chemtura’s Board had approved the sale of the Consumer Products segment in Sep 2013, subject to the completion of definitive transaction documents. The company also entered into a stock purchase agreement in Oct 2013 to sell the proposed asset. The transaction amount was then decided for $315 million, subject to certain customary pre- and post-closing adjustments.

The $15 million reduction in the adjusted purchase price can be accounted to certain pre-closing matters resolved by both the parties. The purchase price is subject to a post-closing adjustment for working capital and assumed pension liabilities. Chemtura treated its Consumer products business as a discontinued operation in its third-quarter 2013 financial statements.

Chemtura will be utilizing the proceeds from the deal for paying its shareholders and for settling its debt, to maintain the same leverage ratio as prior to the sale.

With the assets sale now complete, Chemtura can focus on a series of markets that benefit from global and secular growth trends and win through its product technologies, operating scale and market access.

This acquisition is a milestone in the strategic growth of KIK. Through the integrated businesses KIK is expected to generate strong free cash flow while offering a diversified portfolio of household, pool and spa care, and pool specialty products across varied channels.

KIK is among the largest contract and private label manufacturers of consumer, institutional and industrial products in North America. It is a portfolio company of N.Y.-based private equity firm, CI Capital Partners.

Chemtura, currently, carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the specialty chemicals industry are Ferro Corp. (FOE - Free Report) , Minerals Technologies Inc. (MTX - Free Report) and HB Fuller Co. (FUL - Free Report) . While Ferro Corp. holds a Zacks Rank #1 (Strong Buy), both Minerals Technologies and HB Fuller carry a Zacks Rank #2 (Buy).

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