Solvay enters into a binding agreement to sell its Polyamides business to BASF, a landmark in Solvay's transformation
19 Septembre 2017 - 7:00AM
BASF agrees to
acquire Polyamides for € 1.6 billion
Brussels, Sept. 19, 2017 ---
Solvay has entered into a binding agreement with German chemical
company BASF for the sale of its Polyamides business, a crucial
step in Solvay's transformation towards a multi-specialty chemicals
company.
"Solvay's planned
divestment of Polyamides marks a tipping point in the profound
transformation journey we began four years ago. Successful
completion of this transaction will further reinforce Solvay as a
multi-specialty chemical group, delivering superior growth and
sustainable value," said Jean-Pierre Clamadieu, CEO of
Solvay.
BASF is a strategic investor for
Polyamides which complements both its business as well as its
global presence. Solvay and BASF share the same commitment to
best-in- class health, safety and environment standards on their
sites.
Polyamides has grown profitability
over the past years. As an integrated player, its activities range
from upstream intermediates and polymers, to downstream with the
development of high value-added engineering plastics. The
transaction covers Solvay's upstream and downstream polyamides
business in Europe, North America and Asia, as well as the
downstream engineering plastics business in Latin America and
involves around 2,400 Solvay employees. Solvay will retain its
upstream intermediates and downstream textile polyamide business in
Latin America.
Under the proposed terms of the
agreement, the transaction is based on an enterprise value of €1.6
billion, which represents ~8 EBITDA of 2016 and ~7 EBITDA in the
last twelve months. The expected net cash proceeds are estimated to
be around €1.1 billion. Taking into account the financial
liabilities of about €0.2bn to be transferred to the acquirer, the
net financial position of the Group will improve by about
€1.3bn.
The polyamide business planned to
be divested will be reclassified to assets and liabilities held for
sale and discontinued operations at the end of September. As a
result of the discontinuation, the retained Latin American
polyamide business will incur an impairment of close to €(100)
million to be booked at the end of September. This impairment
is expected to be more than compensated by the capital gain on the
transaction at the closing.
The execution of definitive
agreements is expected in the coming months following consultation
with the relevant social bodies. Solvay and BASF aim to close the
transaction in the third quarter of 2018, after customary
regulatory approvals have been obtained and the formal consent of a
Joint Venture partner has been received. The partner has already
committed to grant its consent subject to the delivery of
definitive documents with BASF.
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Solvay is a multi-specialty
chemical company, committed to developing chemistry that addresses
key societal challenges. Solvay innovates and partners with
customers in diverse global end markets. Its products and solutions
are used in planes, cars, smart and medical devices, batteries, in
mineral and oil extraction, among many other applications promoting
sustainability. Its lightweighting materials enhance cleaner
mobility, its formulations optimize the use of resources and its
performance chemicals improve air and water quality. Solvay is
headquartered in Brussels with around 27,000 employees in 58
countries. Net sales were € 10.9 billion in 2016, with
90% from activities where Solvay ranks among the world's top 3
leaders. Solvay SA (SOLB.BE) is listed on Euronext Brussels
and Paris (Bloomberg: SOLB.BB - Reuters: SOLB.BR)
and in the United States its shares (SOLVY) are traded through a
level-1 ADR program. |
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You can find here the press release
in PDF
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Source: Solvay S.A. via Globenewswire
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