Chemicals group Novacap, which is majority owned by Axa Private Equity, has agreed to acquire a majority stake in Taixing Yangzi Pharm Chemical.
Yangzi is located in Taixing Economic Development Zone, near Shanghai, and is one of the leading Chinese producers of Para-Amino-Phenol (PAP), a chemical intermediate mainly used for the production of paracetamol.
During 2010 and 2011, Yangzi updated its technology from iron reduction to catalytic hydrogenation and its products are widely recognised in the pharmaceutical industry as the benchmark in terms of quality and purity. In 2012, Yangzi employed 375 employees and recorded EUR71m of sales.
After its acquisition of Novacyl from Rhodia in November 2011, the Yangzi transaction represents the next step in Novacap’s strategy to develop its health and pharmaceutical activities. It also significantly increases the footprint of the group outside Europe, with around 50 per cent of employees now located in Asia.
With this new acquisition, the Novacap group’s annual total turnover climbs to EUR710m, an increase of 50 per cent in less than three years. AXA Private Equity acquired a majority stake in Novacap from Bain Capital in January 2011.
“Yangzi is a high quality company in a growing niche market and it already has a longstanding business relationship with Novacyl,” says Pierre Luzeau, chief executive of Novacap. “This acquisition is a decisive strategic move that boosts our paracetamol business while increasing the potential for the combined group’s future growth.”
“This operation represents a great opportunity for Yangzi, as Novacap will provide the company with additional resources to accelerate its development in new geographies and new applications, as well as to pursue its continuous research of best-in-class industrial processes,” says Zhou Zhao Ming, chairman of Yangzi.
“Since Novacap’s acquisition of Novacyl in November 2011, Yangzi has been on our top-priority acquisition list. This transaction is another example of how AXA Private Equity supports its portfolio companies in ambitious international projects,” says Thibault Basquin, managing director at AXA Private Equity.
