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Paramount Trading acquires Tradewell from Wray & Nephew

Published:Wednesday | November 5, 2014 | 12:00 AM
Hugh Graham, CEO of Paramount Trading Jamaica Limited. File

Tameka Gordon, Business Reporter

Paramount Trading Jamaica Limited (PTL) has acquired the operations of industrial chemical manufacturer Tradewell Limited from J. Wray and Nephew as it pushes into the agro-chemicals market.

Paramount said the deal closed in the first quarter ending August, but did not disclose the acquisition price.

Paramount is organised into four primary business segments: a chemical unit, which oversees the distribution of its chemical products; a construction and adhesives division, through which it distributes the French-based SIKA line of construction products, including glues and sealants; a transportation arm, offering haulage services; and a manufacturing division, which makes commercial cleaning agents.

Tradewell is the second acquisition by Paramount in the past four years. The company purchased the assets of Diversey four years ago when that company closed down its Jamaican operations.

"We bought the manufacturing facilities from Johnson Diversey when they were pulling out. What they have done is give us the manufacturing of some of their proprietary products," Graham told Wednesday Business.

Diversey deal

The Diversey deal, he said, was a significant boost to Paramount's production capacity, he said.

With the Tradewell investment, PTL is looking to produce agro-chemical products, such as growth enhancers, that help crops recover from events such as storms.

The equipment acquired from Tradewell include blenders and a homogeniser - "things that bring the chemicals together to make them work," Graham explained.

equipment relocation

The equipment will be relocated from Tradewell to Paramount's chemical division at Waltham Park Road in Kingston, a transfer that Graham says will take some time to execute. Tradewell operated out of Wray & Nephew's agricultural chemical division at Ashenheim Road.

"Tradewell manufactures a line of sanitation products for industrial sanitation, for example, chemicals used to clean hotels and hospitals. Our direction though is not so much to enter that consumer side of the market but to use the equipment and their set-up to deepen our agricultural side," Graham said, even as he declined to give details on the products the company will be manufacturing for that sector.

Otherwise, PTL has also begun production of a drink stabiliser, the CEO said.

Investment in the new product rounded out at about $20 million, he said, noting the process began some three years ago. "It wouldn't be a one time cost," he said, noting that it included research and tests.

"We always wanted to look at the opportunity but we had to get to the point where the market accepted it," said Graham.

The 23-year-old company, which went public in 2012, reported first quarter profit of $34 million off revenue of $203 million.

Profit nearly doubled from $19 million made in the first quarter ending August 2013.