Synthomer snaps up remaining half of Azko Nobel joint-venture

Chemicals group Synthomer has completed bought out joint venture Akzo Nobel's share of Eka Synthomer Oy, a Finnish paper latex producer.

The FTSE 250 group paid €5m to purchase the remaining 50% of Eka Synthomer that it did not own.

Synthomer and Azko Nobel joined forces behind the Finnish vehicle in 2011.

Eka Synthomer, which produces and sells high quality styrene-butadiene latex products for the paper and board industry mainly in Nordic countries, is one of the leading paper latex producers in Europe.

Synthomer chief executive Adrian Whitfield said: "This transaction is consistent with our strategy and represents another logical step in the consolidation of the European SBR latex market."

Synthomer has been one of several in the UK chemicals sector to have been recently hit by a sharp correction.

After the company's results in August, broker Numis highlighted the deep value in the company's shares, but acknowledged that issues remained, including management change in the pipeline and uncertainties regarding the EU's economic prospects.

"However, these are more than fully discounted and income funds will be attracted by the revised dividend policy...to 2.5 times cover...with a 25.0% uplift in the first half dividend."