Investor calls on Brenntag to spin-off specialties business

London - An investor in Brenntag SE has sent a letter to the company’s board making the case for a “timely spin-off” of Brenntag’s Specialties business.

In the letter, supplied to ERJ, Engine Capital LP, argued that Brenntag could double Its current share price within 24 months by following a series of ‘value-enhancing’ recommendations.

In particular, it said, the separation of Brenntag Specialties would “allow the business to achieve its full potential as a standalone entity" and unlock long-term value for Brenntag stakeholders. 

Engine Capital added that the management team should clarify the strategic direction of Brenntag following the “surprising and unfortunate” Univar 'venture'. (See ERJ report)

Engine Capital LP, which owns approximately 1% of Brenntag SE’s outstanding shares, describes itself as “a value-oriented investment fund" with significant experience of investing in chemicals distributors.

These distributors, it stated, are currently or were previously considered direct peers to Brenntag, including Univar Solutions and Nexeo Solutions.