Laporte in takeover talks with Swiss giant

LAPORTE, the UK's third-largest chemical group, is in advanced talks to be taken over by the Swiss giant Clariant, in a deal worth around pounds 1.5bn.

The UK speciality chemicals company was yesterday forced to confirm that it was in takeover negotiations after weekend press speculation of a bid by Clariant had triggered a huge rise in its long-suffering share price. Laporte's admission extended the rally and the stock closed over 29 per cent higher at 762.5p

Laporte, which produces high-quality chemicals for toothpaste, paints and condoms, declined to name the potential bidder, saying simply that it was in discussions over "a possible offer being made for the company".

However, insiders said that Laporte's executives were locked in talks with Clariant, the chemical giant which last year dropped plans for an $8.7bn (pounds 5.4bn) merger with its Swiss rival Ciba Speciality Chemicals. The two sides were hoping to clinch the deal before Friday when Clariant is due to report its annual results. Clariant declined to comment.

Most city analysts said that Clariant was set to draw on its large cash pile to table an offer of at least 800p for each share in Laporte, valuing the UK group at over pounds 1.5bn. However, some industry experts said that Clariant's interest could trigger a bid war which could push the final price to over pounds 1.8bn. They said that the Swiss group could be challenged by a cash-rich US rival.

Mike Eastwood, at Dresdner Kleinwort Benson, said that Laporte's price tag was high because of the good quality of its business. "They are paying a full price, but Laporte has probably the highest-quality portfolio of assets in Europe."

The British group underwent a radical restructuring following the arrival of chief executive Jim Leng in 1995. Through a series of acquisitions and disposals, Mr Leng reduced Laporte's dependence on cut-throat commodity chemicals markets and transformed it into a high-margin speciality chemicals business. Mr Leng's strategy, which caused some 2,000 job losses, culminated in last year's pounds 600m acquisition of Inspec, a highly rated UK fine chemicals group.

Speciality chemicals, used in the pharmaceuticals and electronics industry, are more sophisticated than commodity chemicals and less prone to the vagaries of the economy. The chief executive's changes have been praised by analysts but have not been reflected in Laporte's share price, which last year underperformed the market by up to 50 per cent.

Industry experts said the new-look Laporte would be a perfect fit for Clariant and would cause few competition problems. Last year, the Swiss company said it wanted to expand in the fast-growing fine chemicals and electronic chemicals markets.

News
A model of a Neanderthal man on display at the National Museum of Prehistory in Dordogne, France
science
News
Richard Dawkins dedicated his book 'The Greatest Show on Earth' to Josh Timonen
newsThat's Richard Dawkins on babies with Down Syndrome
Arts and Entertainment
Eye of the beholder? 'Concrete lasagne' Preston bus station
architectureWhich monstrosities should be nominated for the Dead Prize?
Extras
indybest
PROMOTED VIDEO
News
ebooksAn evocation of the conflict through the eyes of those who lived through it
Arts and Entertainment
music
Sport
football
Life and Style
This month marks the 20th anniversary of the first online sale
techDespite a host of other online auction sites and fierce competition from Amazon, eBay is still the most popular e-commerce site in the UK
News
i100
Arts and Entertainment
tv
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Quantitative Analyst (Financial Services, Graduate, SQL, VBA)

£45000 per annum: Harrington Starr: Quantitative Analyst (Financial Services, ...

Application Support Engineer (C++, .NET, VB, Perl, Bash, SQL)

Negotiable: Harrington Starr: Application Support Engineer (C++, .NET, VB, Per...

AIFMD Business Analyst / Consultant - Investment Management

£450 - £600 per day: Harrington Starr: AIFMD Business Analyst / Consultant - I...

Business Analyst Solvency II SME (Pillar 1, 2 & 3) Insurance

£450 - £600 per day: Harrington Starr: Business Analyst Solvency II SME (Pilla...

Day In a Page

Middle East crisis: We know all too much about the cruelty of Isis – but all too little about who they are

We know all too much about the cruelty of Isis – but all too little about who they are

Now Obama has seen the next US reporter to be threatened with beheading, will he blink, asks Robert Fisk
Neanderthals lived alongside humans for centuries, latest study shows

Final resting place of our Neanderthal neighbours revealed

Bones dated to 40,000 years ago show species may have died out in Belgium species co-existed
Scottish independence: The new Scots who hold fate of the UK in their hands

The new Scots who hold fate of the UK in their hands

Scotland’s immigrants are as passionate about the future of their adopted nation as anyone else
Britain's ugliest buildings: Which monstrosities should be nominated for the Dead Prize?

Blight club: Britain's ugliest buildings

Following the architect Cameron Sinclair's introduction of the Dead Prize, an award for ugly buildings, John Rentoul reflects on some of the biggest blots on the UK landscape
eBay's enduring appeal: Online auction site is still the UK's most popular e-commerce retailer

eBay's enduring appeal

The online auction site is still the UK's most popular e-commerce site
Culture Minister Ed Vaizey: ‘lack of ethnic minority and black faces on TV is weird’

'Lack of ethnic minority and black faces on TV is weird'

Culture Minister Ed Vaizey calls for immediate action to address the problem
Artist Olafur Eliasson's latest large-scale works are inspired by the paintings of JMW Turner

Magic circles: Artist Olafur Eliasson

Eliasson's works will go alongside a new exhibition of JMW Turner at Tate Britain. He tells Jay Merrick why the paintings of his hero are ripe for reinvention
Josephine Dickinson: 'A cochlear implant helped me to discover a new world of sound'

Josephine Dickinson: 'How I discovered a new world of sound'

After going deaf as a child, musician and poet Josephine Dickinson made do with a hearing aid for five decades. Then she had a cochlear implant - and everything changed
Greggs Google fail: Was the bakery's response to its logo mishap a stroke of marketing genius?

Greggs gives lesson in crisis management

After a mishap with their logo, high street staple Greggs went viral this week. But, as Simon Usborne discovers, their social media response was anything but half baked
Matthew McConaughey has been singing the praises of bumbags (shame he doesn't know how to wear one)

Matthew McConaughey sings the praises of bumbags

Shame he doesn't know how to wear one. Harriet Walker explains the dos and don'ts of fanny packs
7 best quadcopters and drones

Flying fun: 7 best quadcopters and drones

From state of the art devices with stabilised cameras to mini gadgets that can soar around the home, we take some flying objects for a spin
Joey Barton: ‘I’ve been guilty of getting a bit irate’

Joey Barton: ‘I’ve been guilty of getting a bit irate’

The midfielder returned to the Premier League after two years last weekend. The controversial character had much to discuss after his first game back
Andy Murray: I quit while I’m ahead too often

Andy Murray: I quit while I’m ahead too often

British No 1 knows his consistency as well as his fitness needs working on as he prepares for the US Open after a ‘very, very up and down’ year
Ferguson: In the heartlands of America, a descent into madness

A descent into madness in America's heartlands

David Usborne arrived in Ferguson, Missouri to be greeted by a scene more redolent of Gaza and Afghanistan
BBC’s filming of raid at Sir Cliff’s home ‘may be result of corruption’

BBC faces corruption allegation over its Sir Cliff police raid coverage

Reporter’s relationship with police under scrutiny as DG is summoned by MPs to explain extensive live broadcast of swoop on singer’s home