Private equity firm SK Capital Partners LP has retained advisers to test the market for its specialty ingredients distribution platform, Tilley-Phoenix Group, The Deal has learned.

SK has engaged Guggenheim Securities LLC and Moelis & Co. LLC to run the auction, people familiar with the matter said.

The process is in the information gathering phase and financial data books haven’t been sent, the sources said.

Baltimore-based Tilley-Phoenix generates Ebitda around $50 million to $60 million, sources previously told to The Deal. SK invested in the business in January 2021 and has since more than quadrupled its revenue to more than $500 million through multiple bolt-on deals, as well as organic expansion.

The company’s Ebitda margins of 9% to 12% are in line with other regional chemicals distributors whose product lineups include a similar mix of high- and lower-tier specialty chemicals, sources previously said.

SK may ultimately decide to hold on to Tilley, sources cautioned.

Multiples in the chemicals distribution market have appeared set to climb in recent months, though recent economic uncertainty, including a dramatic stock market pullback, has weighed on dealmakers’ minds over the past few weeks.

Historically, the high water mark on deals for chemicals distribution businesses has landed around 13 or 14 times.

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