Additional Proxy Soliciting Materials (definitive) (defa14a)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of

the Securities Exchange Act of 1934 (Amendment No. )

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Filed by a Party other than the Registrant ¨

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¨ Preliminary Proxy Statement

¨ Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

¨ Definitive Proxy Statement

¨ Definitive Additional Materials

þ Soliciting Material under §240.14a-12

OMNOVA SOLUTIONS INC.

(Name of Registrant as Specified in its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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(1) Title of each class of securities to which transaction applies:

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(3)	Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

(4) Proposed maximum aggregate value of transaction:

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¨ Fee paid previously with preliminary materials.

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Important Information

On July 3, 2019, OMNOVA Solutions Inc. (the "Company") announced it had entered into an Agreement and Plan of Merger with Synthomer plc ("Synthomer"), Spirit USA Holdings Inc., and Synthomer USA LLC, pursuant to which the Company would merge with Spirit USA Holdings Inc., a wholly-owned subsidiary of Synthomer, subject to shareholder and regulatory approvals and other customary conditions (the "Transaction").

In connection with the Transaction, on July 3, 2019, (i) the Company prepared and began to use a Q&A with respect to the Transaction, (ii) the Company's President and Chief Executive Officer, Anne Noonan, made a presentation concerning the Transaction using talking points which were subsequently distributed to Company employees, (iii) the Company prepared and began to use talking points for management discussions with employees relating to the Transaction, and (iv) the Company distributed to Company's employees a letter and slides by Synthomer plc chief executive Calum MacLean that were provided to Anne Noonan.

The text of the Q&A document, the Chief Executive Officer presentation and talking points, the manager talking points for discussions with employees, and the letter and slides from Synthomer's chief executive are reproduced below.

Transaction Q&A

Transaction and Rationale


1.	Who is Synthomer?

Synthomer is a $2.1 billion global supplier of aqueous polymers and specialty chemicals based in the United Kingdom.


2.	Why was Synthomer interested in acquiring OMNOVA?

The acquisition is very complementary to Synthomer’s current business and provides them with new technologies and markets and increased global presence. The nearly $3 billion size of the combined businesses creates major advantages in terms of scale, portfolio, and growth potential.

In addition, the acquisition will provide Synthomer with a strong North American presence, significantly improved specialty strength in Europe, and expanded presence in Asia.


3.	Why do you believe this deal is in the best interest of shareholders?

OMNOVA shareholders will receive $10.15 per share in cash, which represents a 58% premium to the closing price of $6.42 on July 2, 2019. The premium to our share price and the value to be delivered to our shareholders were key considerations in the Board’s decision to sell. In addition, the combination of OMNOVA and Synthomer will become a major force in the special chemicals industry, with best-in-class operational capabilities and a strengthened ability to invest in growth and innovation.


4.	Are you sure the purchase price is an accurate reflection of the value of the company?

OMNOVA is a public company and as such our board of directors has a responsibility to explore all opportunities for value creation and act in the best interest of the shareholders and employees, among other stakeholders. The Board believes this is a value maximizing transaction, and in line with precedent transactions in the space.


5.	When did negotiations begin? Did other potential buyers show interest?

Details will be available in OMNOVA’s proxy statement when it is filed with the SEC.


6.	What are the terms of the agreement?

This information is available in detail in our definitive agreement, which has been filed with the SEC.


7.	When do you expect the transaction to close?

We expect the transaction to close in late 2019 or early 2020.


8.	Are there risks that the transaction will not close?

The transaction is subject to certain conditions such as the receipt of regulatory approvals and approval by both the Company’s and Synthomer’s shareholders.


9.	Did this decision result from OMNOVA’s recently low stock price?

No.


10.	Why was this announced so early in the morning?

Synthomer is a UK-based company and wanted to announce the transaction before stock trading began in London. We wanted to ensure we followed with our announcement quickly afterwards to ensure that our investors, employees, and other stakeholders would hear directly from us.


11.	Do you expect shareholder litigation?

The Company does not comment on litigation matters.

Employees


12.	Is OMNOVA now “owned” by Synthomer?

No. The Company has entered an agreement to be acquired by Synthomer. Before the transaction can occur, both OMNOVA and Synthomer will need to seek shareholder and regulatory approvals. We expect the transaction to close in late 2019 or early 2020. In the meantime, we will continue business as usual as an independent company.


13.	Will anything change for OMNOVA’s employees before closing?

Until the transaction closes in late 2019 or early 2020, it is business as usual:


•	all of OMNOVA’s plans, policies, and benefits will continue


•	merit cycles and bonus programs will continue as usual


•	OMNOVA and Synthomer will operate as separate and independent businesses and may not coordinate commercial activities

Regardless of the potential transaction, it is critical that we continue to drive toward zero-incident safety performance and deliver 2019 financial and strategic commitments. We must ensure that we do not miss any steps in providing our customers with the best products and service.


14.	What will change for OMNOVA’s employees after closing?

The definitive agreement provides customary protections for our employees, including the maintenance of at least current compensation levels, equivalent benefit plans, and current severance programs, until at least the end of 2020. If the transaction closes in early 2020, the protections will extend to the end of 2021. Afterwards, Synthomer may decide to adjust benefits plans and programs as it determines appropriate for the attraction and retention of employees.


15.	Will anything change for collective bargaining agreements? What about upcoming contract negotiations?

It’s business as usual, and any currently planned negotiations will proceed as normal.


16.	Synthomer has disclosed they are looking for nearly $30 million of synergies from the transaction. How many jobs will be lost? Will any facilities be closed?

We cannot speak for Synthomer, and they have not had any discussions with OMNOVA personnel regarding facilities or operations after closing. Synthomer will provide more details of their plans as integration plans are developed.

You should know that given the complementary nature of our businesses and footprint, Synthomer has expressed a strong interest in employee retention to support their growth strategy. During conversations with Anne, Calum MacLean, CEO of Synthomer noted that the organizations are highly complementary, and that Synthomer values the “knowledge, expertise and capability” of OMNOVA employees.

As with any combination, there will likely be some overlap of functions between the two companies. Based on Synthomer’s public disclosures, we expect that most of their projected synergies will come from dissolving OMNOVA’s Board of Directors and eliminating executive leadership positions.


17.	Will Synthomer provide any severance, benefits, or other assistance to the employees that are laid off?

The definitive agreement provides that OMNOVA’s current severance benefits program will remain in place until at least the end of 2020, and if the transaction closes in 2020, the program will extend to the end of 2021. The leadership of both companies has committed that employees will be treated fairly. Keep in mind this announcement is just the first step in the process and we will let you know more as soon as we can.


18.	What will happen if the sale does not go through for some reason?

Should the deal not close as expected, OMNOVA would continue as an independent public company. Therefore, we must continue to deliver on our 2019 safety, financial, and strategic commitments. We must continue to operate our business in a manner consistent with our core values of Safety, Integrity, Agility and Accountability.


19.	Will the Synthomer culture be a good fit for us?

Yes. From everything we have learned, Synthomer’s culture and people philosophy are very similar to OMNOVA’s and we believe Synthomer will be a great cultural fit for OMNOVA employees.


20.	Can I buy or sell OMNOVA shares? Are there any restrictions?

You are free to buy/sell OMNOVA stock in the ordinary course. However:


•	If you are an OMNOVA employee who is subject to OMNOVA’s Insider Trading Policy, you must still follow its window period and pre-clearance requirements.


•	As we work with Synthomer towards closing, there may be certain employees who will be restricted from trading in OMNOVA stock because of their involvement in the transaction. These employees will be notified of the restrictions if and when they apply.


21.	How much money will executive leadership make from the transaction?

Synthomer has agreed to honor all existing employee agreements and severance programs. Shareholders will receive the offer value of $10.15 per share for their OMNOVA shares. For the executives, their individual, market-based, plans will be honored by Synthomer, and information concerning executive compensation will be disclosed in the Company’s proxy statement filed with the SEC.

Customers and Suppliers


22.	What can OMNOVA’s customers/partners/suppliers expect to change as a result of the transaction?

Importantly, until the transaction closes, OMNOVA will continue to operate as an independent enterprise. Nothing will change for customers in the near term and their point of contact at OMNOVA will remain the same as it is today. We will continue to provide customers with the high level of service and quality products that they have come to expect from us.

We believe this transaction will benefit our customers by making OMNOVA part of a larger, stronger global enterprise with the resources to fully support a more diverse suite of specialty solutions.


23.	Will Synthomer continue to support my business after the closing?

While we cannot speak for Synthomer, Synthomer is acquiring our entire business and has not given us any indication that they plan to discontinue any part of our business. OMNOVA has complementary chemistries across our portfolio, including both Specialty Solutions and Performance Materials. We expect to hear more from Synthomer soon about their plans.


24.	Does this mean OMNOVA products may become available in other geographies and markets?

In the near term it will be business as usual. While we can’t speak for Synthomer, we believe this transaction will benefit our customers by making OMNOVA part of a larger, stronger global enterprise with the resources to fully support a more diverse suite of specialty solutions.

Important Disclosures

Forward-Looking Statements

Forward-looking statements within this Current Report on Form 8-K are being made in reliance upon the safe harbor of the Private Securities Litigation Reform Act of 1995, including, without limitation, the statements made concerning the Company’s intent to consummate the transactions contemplated by the Merger Agreement with Parent. As a general matter, forward-looking statements are those focused upon anticipated events or trends, expectations, and beliefs relating to matters that are not historical in nature. Such forward-looking statements are subject to uncertainties and factors relating to the Company’s operations and business environment, all of which are difficult to predict and many of which are beyond the control of the Company. Among others, the following uncertainties and other factors could cause actual results to differ from those set forth in the forward-looking statements: (i) the risk that the transactions contemplated by the Merger Agreement may not be consummated in a timely manner, if at all; (ii) the risk that the definitive Merger Agreement may be terminated in circumstances that require the Company to pay Parent a termination fee; (iii) risks related to the diversion of management’s attention from the Company’s ongoing business operations; (iv) the effect of the announcement of the proposed transactions on the Company’s business relationships (including, without limitation, customers and suppliers), operating results and business generally; (v) risks related to obtaining the requisite consents to the proposed transactions, including, without limitation, the receipt of approval from the Company’s shareholders and Parent’s shareholders, the timing (including possible delays) and receipt of regulatory clearance from governmental authorities (including any conditions, limitations or restrictions placed on these approvals) and the risk that one or more governmental authority may deny any such approval; and (vi) the conditions of the capital markets during the period covered by the forward-looking statements. Further risks that could cause actual results to differ materially from those matters expressed in or implied by such forward-looking statements are set forth under “Risk Factors” in the Company’s Annual Report on Form 10-K for the fiscal year ended November 30, 2018, and its subsequent quarterly reports on Form 10-Q. The Company does not undertake, and hereby disclaims, any duty to update these forward-looking statements, although its situation and circumstances may change in the future.

Additional Information

In connection with the proposed transactions, the Company intends to file with the United States Securities and Exchange Commission (the “SEC”) a proxy statement, the definitive version of which will be sent or provided to the Company’s shareholders, and other documents relevant to the transactions contemplated by the Merger Agreement. THE COMPANY’S SHAREHOLDERS ARE URGED TO READ THE PROXY STATEMENT (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO ANY DOCUMENTS INCORPORATED BY REFERENCE THEREIN) AND OTHER RELEVANT DOCUMENTS IN CONNECTION WITH THE TRANSACTIONS THAT THE COMPANY WILL FILE WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTIONS AND THE PARTIES TO THE TRANSACTIONS. Shareholders and investors will be able to obtain free copies of the proxy statement and other relevant materials (when they become available) and other documents filed by the Company’s at the SEC’s web site at www.sec.gov. Copies of the proxy statement (when they become available) and the filings that will be incorporated by reference therein may also be obtained, without charge, from the Company’s website, www.omnova.com, or by contacting the Company’s Investor Relations at (216) 682-7003.

Participants in the Solicitation

The Company, its directors and certain of its executive officers and employees may be deemed, under SEC rules, to be participants in the solicitation of proxies from the Company’s investors and security holders in connection with the proposed transactions. Information about the Company’s directors and executive officers is set forth in the Company’s proxy statement for its 2019 Annual Meeting of Shareholders and the Company’s Annual Report on Form 10-K for the fiscal year ended November 30, 2018. Additional information regarding the interests of participants in the solicitation of proxies in connection with the proposed transactions will be included in the proxy statement and other documents relevant to the proposed transactions that the Company intends to file with the SEC. These documents may be obtained for free (when they become available) as described above.