Quaker Chemical Corp. and Houghton International Inc. executed a definitive agreement to combine the companies. The businesses, which are both headquartered in the Philadelphia, Pa., area, have a combined 250-year history as providers of process fluids, chemical specialties and technical expertise to the global primary metals and metalworking industries. Combining Quaker Chemical’s and Houghton International’s product solutions and service offerings will allow the new company to better serve customers in the automotive, aerospace, metals, mining, machinery and marine industries.

The combined business will have one of the world's most expansive metalworking platforms comprised of specialty products that include removal fluids, forming fluids, protecting fluids, heat-treating fluids, industrial lubricants and greases. The expanded portfolio is expected to allow further expansion into growth markets that include India, Korea, Japan and Mexico. The new company will increase the breadth of its innovative technology, accelerate its product development initiatives and time to market, and diversify its long-term R&D pipeline.

Under the terms of the agreement, Houghton International shareholders will receive $172.5 million of cash and 24.5% ownership of the combined company, representing approximately 4.3 million shares of newly issued Quaker Chemical stock. In addition, Quaker Chemical will assume Houghton International's debt and cash, with net debt of approximately $690 million at year-end 2016.  The agreement has been approved by both Quaker Chemical's board of directors and Houghton International's board of directors with full support of the Hinduja Group, which will become Quaker Chemical's largest shareholder.