Calgon Carbon Corporation (CCC), a global leader in services and solutions for making water and air safer and cleaner and its European operation, Chemviron Carbon, has acquired Zwicky Denmark and Sweden, long-term distributors of Chemviron Carbon’s activated carbon products and providers of services associated with the reactivation of activated carbon.
Calgon Carbon expects the acquisition to accelerate sales growth in Denmark, Norway and Sweden and to expand the company’s service capabilities in Europe since the Zwicky companies have been the exclusive distributor of its activated carbon products of Chemviron Carbon.
Headquartered in Pittsburgh, Pennsylvania, Calgon Carbon is the largest producer globally in the pollution control market, with 16 facilities in 12 countries. The company manufactures products and provides services to decontaminate and deodorize liquids and gases. About 62% of its total sales are in the U.S., while 31% are in Europe. The company is among the top five producers in the U.S. market.
Calgon Carbon is a leader in the activated carbon segment, an area benefiting from high prices and significant growth opportunities. However, the company is faced with weak demand for carbon products, its major business segment. The weak global economy hurt volumes in the first half of 2009, a trend that is expected to remain in place in the near term.
Lower demand in many of Calgon Carbon’s end markets has resulted in a considerable decline in activated carbon and service sales volume. However, we believe that demand for activated carbon will strengthen going forward, supporting strong pricing. We maintain our Neutral recommendation on the stock.
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