Finnish chemicals company Kemira has reached an agreement to sell its oil and gas business to Sterling Specialty Chemicals.

On a cash and debt-free basis, the entire consideration is around $280m (€258.84m).

Kemira's oil and gas business is primarily focused on treating oil sands tailings, cEOR, and shale oil and gas.

In 2022, the revenue from the oil and gas unit was €377m, around 11% of Kemira's overall revenue.

As part of the deal, some 250 staff are expected to move to Sterling Specialty Chemicals, a US subsidiary of Artek Group.

The transaction includes Kemira’s assets in the US, the UK and the Netherlands.

For Kemira, the divesture forms part of efforts to shift its focus to core operations.

Concurrently, Kemira and Sterling Specialty Chemicals will enter a reciprocal contract manufacturing agreement.

Kemira interim president and CEO Petri Castrén said: “The divestment of the oil and gas business will clarify our focus on sustainability and our strategic priorities: we want to expand in water, build a leading renewables portfolio and digital services business.

“This move strengthens our capability to look for growth within our water treatment and pulp and paper businesses, and also to explore new growth opportunities.”

Artek Group director Vishal Goenka said: “The acquisition of a high-quality oil and gas-related portfolio from Kemira is another step in our global vision and growth strategy of becoming a leading speciality chemicals player.

“We warmly welcome all new employees and are looking forward to exploring exciting future growth opportunities together with our existing oil and gas business. We are also pleased with our long-term partnership with Kemira, one of our largest customers going forward.”

The companies expect to close the deal by the end of the first quarter of 2024, subject to customary closing conditions and regulatory approvals.