Ethyl to buy Texaco's lube additive business

Abstract

Ethyl Corp. has agreed to buy Texaco's lubricant additives business, consolidating Ethyl's position as the third largest U.S. producer of lubricant additives. The deal, expected to close before the end of the year, will add Texaco's sales of lubricant additives worth $350 million in 1994 to Ethyl's sales of lubricant and fuel additives worth $1 billion. Both companies decline to reveal the financial terms. But industry sources suggest Ethyl may pay $250 million to $300 million for Texaco's operations, which employ 450 people and have facilities in Port Arthur, Texas; Ghent, Belgium; and Rio de Janeiro. The acquisition will give Ethyl 24% of the domestic lubricant additives business, up from 17%, says Paul K. Raman, vice president of investment banking firm S. G. Warburg, New York City. Lubrizol would continue to be the largest U.S. producer of additives blended into automotive crankcase oil, transmission and hydraulic fluids, and gear oils, followed by Exxon and then ...