(Adds details on Quinpario and Royal Adhesives)
By Greg Roumeliotis and Mike Stone
Feb 6 (Reuters) - Quinpario, a blank-check acquisition company run by former Solutia Inc Chief Executive Jeffry Quinn, is in advanced talks to buy specialty tape maker Royal Adhesives & Sealants LLC for around $1 billion, according to people familiar with the matter.
The acquisition vehicle, dubbed Quinpario Acquisition Corp 2 , has so far outbid private equity firms, including American Securities LLC, in the auction for Royal Adhesives, the people said on Friday.
Quinpario, which needs to raise debt financing for the deal, has yet to finalize negotiations, the people cautioned. Arsenal Capital Partners, the buyout firm that owns Royal Adhesives, may still decide to sell the company to American Securities or another bidder, the people added.
The sources asked not to be identified because the negotiations are confidential. Quinpario, Arsenal Capital Partners and American Securities declined to comment, while Royal Adhesives did not respond to a request for comment.
South Bend, Indiana-based Royal Adhesives produces a broad array of adhesives and sealants for the transportation, construction, paper, plastic and assembly-related markets.
Arsenal acquired Royal Adhesives from investment firm Quad-C Management Inc and merged with another specialty adhesives, coatings and polymers company, Para-Chem Southern, in 2010. Royal Adhesives has since grown with seven more acquisitions, according to its website.
Saint Louis, Missouri-based Quinpario Acquisition Corp 2 raised $350 million in an initial public offering last month. Its aim is to acquire specialty chemicals and performance materials companies valued at $700 million to $2 billion, including debt, according to its website.
Quinpario’s previous acquisition vehicle raised $172.5 million in an IPO in 2013 and went on to acquire Jason Inc, a manufacturer of automotive parts and motorcycle seating, a year later from a consortium of investment firms for $539 million. (Reporting by Greg Roumeliotis and Mike Stone in New York; Editing by Chizu Nomiyama and Richard Chang)