03.17.20
Huntsman Corporation announced its agreement to acquire CVC Thermoset Specialties, a North American specialty chemical manufacturer serving the industrial composites, adhesives and coatings markets.
CVC Thermoset Specialties is part of Emerald Performance Materials LLC which is majority-owned by affiliates of American Securities LLC.
CVC Thermoset Specialties has annual revenues of approximately $115 million with two manufacturing facilities located in Akron, Ohio, and Maple Shade, NJ.
Under terms of the agreement, Huntsman will pay $300 million, subject to customary closing adjustments, in an all-cash transaction funded from available liquidity.
Based on full year 2019, the purchase price represents an adjusted EBITDA multiple of approximately 10 times, or between approximately seven to eight times pro forma for synergies, the lower multiple end being dependent upon normal growth market conditions.
The transaction is expected to close around midyear of 2020.
“The acquisition of CVC Thermoset Specialties brings valuable complementary technology breadth to our Advanced Materials portfolio and its unique products will make systems using our class-leading epoxy-based materials even tougher, stronger, and more durable," said Scott Wright, president of Huntsman's Advanced Materials division. "This business manufactures highly specialized toughening, curing and other additives used in a wide range of composite, adhesive and coatings applications across aerospace, automotive and industrial markets."
“This bolt-on fits all the criteria we look for in acquisitions for our Advanced Materials division, including new technology, synergies, and globalization opportunities," added Peter Huntsman, chairman, president and CEO. "The business currently achieves EBITDA margins in excess of 25 percent and we expect to achieve significant synergies within two years.
“In these uncertain times, our financial strength will allow us to keep looking for these types of acquisitions, while at the same time maintain a conservative balance sheet and opportunistically repurchase shares," he continued. "We remain committed to our balanced approach to capital allocation. Year-to-date we have taken advantage of our depressed stock price and have repurchased approximately $85 million in stock.
"Lastly, while forward visibility remains low, the first quarter is on track to deliver on the outlook that we communicated on our Feb. 13, 2020 earnings call.”
CVC Thermoset Specialties is part of Emerald Performance Materials LLC which is majority-owned by affiliates of American Securities LLC.
CVC Thermoset Specialties has annual revenues of approximately $115 million with two manufacturing facilities located in Akron, Ohio, and Maple Shade, NJ.
Under terms of the agreement, Huntsman will pay $300 million, subject to customary closing adjustments, in an all-cash transaction funded from available liquidity.
Based on full year 2019, the purchase price represents an adjusted EBITDA multiple of approximately 10 times, or between approximately seven to eight times pro forma for synergies, the lower multiple end being dependent upon normal growth market conditions.
The transaction is expected to close around midyear of 2020.
“The acquisition of CVC Thermoset Specialties brings valuable complementary technology breadth to our Advanced Materials portfolio and its unique products will make systems using our class-leading epoxy-based materials even tougher, stronger, and more durable," said Scott Wright, president of Huntsman's Advanced Materials division. "This business manufactures highly specialized toughening, curing and other additives used in a wide range of composite, adhesive and coatings applications across aerospace, automotive and industrial markets."
“This bolt-on fits all the criteria we look for in acquisitions for our Advanced Materials division, including new technology, synergies, and globalization opportunities," added Peter Huntsman, chairman, president and CEO. "The business currently achieves EBITDA margins in excess of 25 percent and we expect to achieve significant synergies within two years.
“In these uncertain times, our financial strength will allow us to keep looking for these types of acquisitions, while at the same time maintain a conservative balance sheet and opportunistically repurchase shares," he continued. "We remain committed to our balanced approach to capital allocation. Year-to-date we have taken advantage of our depressed stock price and have repurchased approximately $85 million in stock.
"Lastly, while forward visibility remains low, the first quarter is on track to deliver on the outlook that we communicated on our Feb. 13, 2020 earnings call.”