Divestitures

3 Months Ended

Mar. 31, 2021

Discontinued Operations and Disposal Groups [Abstract]

Disposal Groups, Including Discontinued Operations, Disclosure

Divestitures:

On February 25, 2021, the Company signed a definitive agreement to sell its fine chemistry services (“FCS”) business to W. R. Grace & Co. (“Grace”) for proceeds of approximately $570 million, consisting of $300 million in cash and the issuance to Albemarle of preferred equity of a Grace subsidiary having an aggregate stated value of $270 million. The preferred equity can be redeemed at Grace’s option under certain conditions and will accrue payment-in-kind (“PIK”) dividends at an annual rate of 12% beginning two years after issuance.

As part of the transaction, Grace will acquire our manufacturing facilities located in South Haven, Michigan and Tyrone, Pennsylvania. The sale of the FCS business reflects the Company’s commitment to investing in its core, growth-oriented business segments. The sale is expected to close in the second quarter of 2021, subject to the satisfaction of customary closing conditions, including approvals from regulatory authorities. We currently expect to record a gain in the second quarter of 2021 related to the sale of this business.

We determined that this business met the assets held for sale criteria in accordance with ASC 360, Property,Plant and Equipment during the first quarter of 2021. As such, the assets and liabilities of this business were included in Assets held for sale and Liabilities held for sale, respectively, in the consolidated balance sheet at March 31, 2021.

The carrying amounts of the major classes of assets and liabilities that were classified as held for sale at March 31, 2021 are as follows (in thousands):

	March 31, 2021
Assets
Inventories	$	45,225
Other current assets	21,165
Net property, plant and equipment	44,080
Goodwill and other noncurrent assets	6,603
Assets held for sale	$	117,073
Liabilities
Current liabilities	$	4,068
Liabilities held for sale	$	4,068

The results of operations of the business classified as held for sale is included in the consolidated statements of income. This business did not qualify for discontinued operations treatment because the Company’s management does not consider the sale as representing a strategic shift that had or will have a major effect on the Company’s operations and financial results.