Abstract
Brenntag, the world’s largest chemical distributor, is being pressured by a second activist investor to break up the company. In a letter to Brenntag management, Engine Capital, which owns 1% of Brenntag’s shares, says the company’s specialties unit has been underperforming relative to peers. Engine is calling for the business, which has annual sales of about $6.4 billion, to be spun off. The investor notes that specialty chemical distribution requires emphasis on technical services and applications development, unlike the balance of Brenntag, which focuses on bulk commodities. The firm’s management heard a similar argument in December from PrimeStone; that investor urged the firm to end merger talks with rival Univar Solutions.
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