EagleTree Capital LP has agreed to sell Gaylord Chemical Co. LLC, which does business as gChem, to ContextLogic Holdings Inc. at an $850 million enterprise valuation.

According to a Wednesday, Aug. 5, statement from Covington, La.-based gChem, the company will become ContextLogic’s second operating business after its acquisition of US Salt LLC, which was closed in February.

CEO Frank Roederer and the existing management team will continue to lead specialty chemicals company gChem.

The Deal reported almost exactly a year ago that EagleTree had retained Morgan Stanley to run a second auction process for gChem, with sources saying the business was expected to be marketed on $70 million to $80 million of Ebitda. The process followed a brief 2022 market test, when EagleTree tapped Piper Sandler Cos.

GChem manufactures specialty ingredients including dimethyl sulfide, dimethyl sulfoxide, dinitrogen tetroxide and Procipient, its pharmaceutical-grade DMSO product. The company’s products are used in technically demanding applications across pharmaceuticals, semiconductors, agricultural and performance chemicals and aerospace, including as solvents for active pharmaceutical ingredient manufacturing and cryopreservation media.

EagleTree acquired gChem in October 2018 from its private owners, including then-CEO Paul Dennis. The company generated about $25 million in Ebitda at the time of EagleTree’s investment and grew to about $150 million of Ebitda by mid-2022.

Under EagleTree’s ownership, gChem invested in commercial expansion, manufacturing capacity and innovation, including back-integration into dinitrogen tetroxide, a key building block of DMSO. The company said that effort led to the development and construction of the world’s first and only on-purpose NTO production facility.

Oakland, Calif.-based ContextLogic, which trades over the counter and is backed by BC Partners LLP and Abrams Capital Management LP, is building a portfolio of niche, defensible businesses run by autonomous management teams whose incentives are aligned with shareholders.

The company agreed in December to buy US Salt, a high-purity evaporated salt producer, from Emerald Lake Capital Management LLC for $907.5 million, which marked its first major step toward becoming a long-term business ownership platform.

The acquisition of US Salt was the first to come after ContextLogic’s sharp pivot away from its former e-commerce business — once known as Wish.com and the world’s most downloaded shopping app in 2018 — which it ultimately sold in 2024 for $173 million. The sale left it with $2.7 billion of net operating loss carryforwards.

New York-based EagleTree, spun out from Wasserstein & Co. LP in 2015, primarily focuses on investing in North American companies in the media and business services, consumer, and water and specialty industrial sectors.

Eagletree closed its sixth flagship fund in 2024.

The gChem transaction marks EagleTree’s second exit in a week. Last week, the firm said a subsidiary of Xylem Inc. (XYL) acquired WaterFleet LLC, a provider of mobile water and wastewater utility services, from EagleTree-managed funds and co-investors for about $200 million.

ContextLogic expects to close the gChem acquisition by the end of 2026, subject to customary regulatory approvals and other closing conditions.

Morgan Stanley provided financial advice to gChem, with Andrew M. Levine, William T. Sinchuk, Zac Nallen and Tim Kruger of Jones Day providing counsel.

Piper Sandler was ContextLogic’s financial adviser, while a Ropes & Gray LLP team led by Sarah Schaffer-Raux, Suni Sreepada and Christopher J. Capuzzi provided counsel.

Stelios G. Saffos, Peter J. Sluka, Michael H. Waldman and Salvatore Vanchieri Jr. led a Latham & Watkins LLP team that was counsel to Blackstone Credit & Insurance, which provided debt financing for the acquisition.