Evonik Selling Chem Unit to German Buyout Firm

FRANKFURT (Reuters) – German industrial conglomerate Evonik said it has agreed in principle to sell its specialty chemicals unit Alzchem to German buyout group Bluo amid an ongoing strategic review.

Alzchem — whose products range from ingredients for pesticides and fertiliser to additives for cosmetics and food — has a staff of about 1,300.

Evonik’s board as well as Germany’s cartel office still have to give the green light, an Evonik spokeswoman said.

Evonik, owned by the government-controlled RAG foundation and private equity firm CVC [CVC.UL], makes more than 70 percent of total revenue from chemicals. It also builds and operates power plants and manages a real estate portfolio.

Evonik said in July it was reconsidering its strategy with the help of investment bank JP Morgan (JPM.N).

Earlier this month it denied it was considering transforming itself into a pure chemicals group. [ID:nLJ471643]

Bluo was set up by former Arques (AQUG.DE) executives. Its holdings include the Pit-Stop chain of car-repair shops and news agency ddp.

(Reporting by Nikola Rotscheroth, writing by Ludwig Burger; Editing by David Cowell)