Electronic purification materials maker Entegris Inc. (ENTG) is gauging the market’s interest in its high-purity process chemicals business, The Deal has learned.
Entegris has engaged BofA Securities Inc. to run an auction for the business, four industry sources said.
Entegris’ high-purity chemicals business, which essentially makes chemicals used to wash semiconductors between production steps, generates run-rate Ebitda of $75 million, the sources said. The unit’s run-rate margins are in the high teens, two of the sources added, putting revenue in the ballpark of $400 million to $450 million.
The process launched around six to eight weeks ago, and BofA advised bidders to submit initial indications of interest by the week of Nov. 21, two of the sources said.
The business is expected to generate significant interest from a mix of private equity and strategic bidders, sources said. Entegris may fetch a multiple of around 9 to 10 times Ebitda for the business, one of the sources estimated.
Billerica, Mass.-based Entegris has been an active acquirer in the electronics purification materials industry over the past several years.
Entegris picked up the high-purity chemicals unit through the $5.7 billion acquisition of CMC Materials Inc. in December 2021. CMC, formerly Cabot Microelectronics Corp., inherited the unit now on the block through the $1.2 billion acquisition of KMG Chemicals Inc. in 2018.
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