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Koppers Holdings Inc. has agreed to sell Koppers (Jiangsu) Carbon Chemical Company Limited to Fangda Carbon New Material Co. Ltd. and C-Chem Co. Ltd, a subsidiary of NIPPON STEEL Chemical & Material Co. Ltd. for $107 million.

KJCC, a tar distillation facility in Pizhou City, Jiangsu Province, China, is 75-percent owned by Koppers, with the remaining 25 percent owned by Yizhou Group Company Limited.

Koppers expects to realize approximately $65 million of net cash, after noncontrolling interest, taxes and expenses. The company plans to apply the cash proceeds toward debt reduction, consistent with its stated goals.

The closing is subject to the customary closing conditions, including receipt of regulatory approvals in China and approval of the transaction by the shareholders of Fangda Carbon. Koppers expects that approvals could be received in approximately four to six months.

In connection with the transaction, KJCC has reached agreement with its largest customer in China to resolve a contractual dispute related to application of contractual pricing terms. The settlement will become effective upon the closing of the transaction.

Koppers Executive Vice President and COO James Sullivan stated, “This is an immensely important step toward sharpening our focus on our portfolio of wood-based technologies which are built on our company’s purpose of protecting what matters and preserving the future.”

President and CEO Leroy Ball added, “Despite KJCC’s uneven financial performance since being commissioned in mid-2014, the overall returns were in line with our expectations on a cumulative basis and the operations exhibited solid financial performance by averaging approximately $10.5 million of EBITDA annually over the five-year period of 2015 to 2019. Although there is still much work to do to complete this transaction, including receiving regulatory approvals, we have reached a key milestone and I am confident that all parties are interested in reaching a successful conclusion.”

Koppers is a Pittsburgh-headquartered global provider of treated wood products, wood treatment chemicals and carbon compounds.