In a significant move within the lubricant industry, One Equity Partners (OEP) has finalized an agreement to divest its Sonneborn Holdings L.P. operating subsidiaries. HollyFrontier Corporation, a prominent independent petroleum refiner and marketer, is set to acquire Sonneborn in a transaction valued at USD655 million. This strategic acquisition, anticipated to close in 2019, remains subject to customary closing conditions and regulatory approvals.
This acquisition marks a pivotal moment for Sonneborn, a company with a rich history dating back to 1903. Sonneborn is a globally recognized manufacturer specializing in high-purity white oil, petrolatum, microcrystalline wax, sodium sulfonate, and compressor lubricants. These specialized products cater to a diverse clientele of over 500 customers worldwide, spanning industries such as personal care, pharmaceuticals, food, polymer, and metalworking. Headquartered in Parsippany, New Jersey, Sonneborn boasts a global footprint with approximately 360 employees and production facilities strategically located in the U.S.A. and the Netherlands. The acquisition by HollyFrontier signals a new chapter for Sonneborn and its renowned lubricant offerings.
One Equity Partners, the private equity firm behind this successful venture, has a strong track record of fostering growth and strategic initiatives within its portfolio companies. Established in 2001 and subsequently spun out from JP Morgan in 2015, OEP has cultivated a global presence with offices in New York, Chicago, and Frankfurt. With over 180 transactions completed worldwide since its inception and assets under management exceeding USD5 billion, One Equity Partners focuses on transformative combinations across the industrial, healthcare, and technology sectors in North America and Europe. Their partnership with Sonneborn aimed to solidify the company’s leadership position in the global specialty lubricants market.
David Han, senior managing director of One Equity Partners, expressed satisfaction with the partnership, stating, “We greatly appreciate the opportunity to partner with Sonneborn management team… The strategic initiatives that Sonneborn undertook during our partnership have clearly solidified its global leadership position.” This sentiment underscores the successful collaboration between One Equity Partners and Sonneborn in enhancing the company’s market standing and operational capabilities, particularly within the lubricant sector. The sale to HollyFrontier represents a culmination of these efforts and a recognition of Sonneborn’s enhanced value.
Paul Raymond III, president and CEO of Sonneborn, also acknowledged the positive impact of the partnership with OEP. “We would like to thank OEP and the Board of Directors for their unwavering support of the growth initiatives… We look forward to continuing delivering significant value for our customers as we enter the next phase of our growth.” This forward-looking statement emphasizes Sonneborn’s commitment to continued excellence and innovation under new ownership, leveraging the foundation built in partnership with One Equity Partners.
HollyFrontier Corporation, the acquiring entity, is headquartered in Dallas, Texas, and operates as a leading independent petroleum refiner and marketer. The company specializes in producing high-value light products, including gasoline, diesel, jet fuel, and other specialty products. HollyFrontier’s extensive refining network includes five refineries located in Kansas, Oklahoma, New Mexico, Wyoming, and Utah, with a combined capacity of over 450,000 barrels per stream day. Furthermore, HollyFrontier’s reach extends into the lubricant market through its subsidiary, Petro-Canada Lubricants Inc., which operates a significant base oil and specialty lubricant production facility in Mississauga, Ontario, Canada. This acquisition of One Equity Partners’ lubricant asset, Sonneborn, is a strategic expansion for HollyFrontier, enhancing its presence in the high-value specialty lubricants market and broadening its product portfolio.
Morgan Stanley & Co. LLC served as the financial advisor to Sonneborn for this transaction, while Baker McKenzie provided legal counsel. This team of advisors underscores the significance and complexity of the deal, ensuring a smooth transition and successful outcome for all parties involved in this One Equity Partners Lubricant Acquired transaction. The acquisition is poised to create synergistic opportunities and further strengthen HollyFrontier’s position in the evolving energy and specialty chemicals landscape.
