NORTH CHARLESTON, S.C.--(BUSINESS WIRE)--Ingevity Corporation (NYSE:NGVT) today announced it has reached an
agreement with Perstorp Holding AB to acquire the CapaTM
caprolactone division of Perstorp in a cash transaction valued at
approximately €590 million (approximately $675 million). The acquisition
is subject to certain regulatory approvals and other customary closing
conditions, and Ingevity expects to close on the transaction late in the
first quarter of 2019.
Capa is the global market leader in the production and commercialization
of caprolactone and high-value downstream derivatives, including
caprolactone polyols, caprolactone thermoplastics, caprolactone
lactides, and hexanediol (HDO). The division’s products are key
components in adhesives, bioplastics, coatings, elastomers and resins.
The business operates a manufacturing facility in Warrington, England,
U.K., and employs approximately 90 people.
Capa expects revenues of approximately €150 million (approximately $175
million) and adjusted earnings before interest, taxes, depreciation and
amortization (EBITDA) of approximately €50 million (approximately $60
million) for the 2018 fiscal year, representing adjusted EBITDA margins
in the mid-30s percent range. The acquisition is expected to be
immediately accretive to Ingevity’s earnings in the first full year.
Ingevity will include the business in the company’s Performance
Chemicals segment and report revenues as “Engineered Polymers.”
“The Capa division is a strong, market-leading business focused on
high-growth end-use applications, and as such is a complementary fit
with Ingevity’s business model and capabilities,” said Michael Wilson,
Ingevity president and CEO. “Like our current businesses, Capa leverages
technology-focused relationships to drive customer intimacy and employs
a similar manufacturing process and approach.
“We are very excited to be adding such a unique business to our company;
one that will provide new avenues for strategic growth,” he said.
“What’s more, Capa’s top-tier financial profile and performance will
drive value creation to the benefit of our shareholders.”
“The senior managers and employees of the Capa division are looking
forward to joining Ingevity,” said Stephen Lewis, vice president,
Caprolactones for Perstorp. “We believe Ingevity is a great cultural fit
for our people and the combination of these two companies will
accelerate our success.”
Ingevity will fund this transaction through a combination of the
company’s cash and existing bank credit facility. J.P. Morgan acted as
financial advisor and Eversheds Sutherland acted as legal counsel to
Ingevity.
Conference Call Scheduled for 8:30 a.m. ET Today
The company will host a 30-minute conference call on Monday, Dec. 10, at
8:30 a.m. (Eastern Time) to discuss the transaction. Those who wish to
participate in this event should dial (800) 230-1059 (inside the U.S.)
or (612) 234-9960 (outside the U.S.), at least 15 minutes prior to the
start of the call. In addition, a slide deck for use during the
conference call has been posted on the investors section of Ingevity’s
website. Replays will be available through Jan. 10, 2019, and can be
accessed at (800) 475-6701 (inside the U.S.) or (320) 365-3844 (outside
the U.S.), with access code 458383.
Ingevity: Purify, Protect and Enhance
Ingevity provides specialty chemicals and high-performance carbon
materials and technologies that purify, protect and enhance the world
around us. Through a team of talented and experienced people, Ingevity
develops, manufactures and brings to market products and processes that
help customers solve complex problems. These products are used in a
variety of demanding applications, including asphalt paving, oil
exploration and production, agrochemicals, adhesives, lubricants,
publication inks and automotive components that reduce gasoline vapor
emissions. Headquartered in North Charleston, South Carolina, Ingevity
operates from 25 locations around the world and employs approximately
1,600 people. The company is traded on the New York Stock Exchange
(NYSE: NGVT). For more information visit www.ingevity.com.
Forward-Looking Statements
This press release contains “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995. Such
forward looking statements generally include the words “may,” “could,”
“should,” “believes,” “plans,” “intends,” “targets,” “will,” “expects,”
“suggests,” “anticipates,” “outlook,” “continues,” “forecast,”
“prospect,” “potential” or similar expressions. Forward-looking
statements may include, without limitation, expected financial
positions, results of operations and cash flows; financing plans;
business strategies and expectations; operating plans; synergies and the
potential benefits of the acquisition of Perstorp Holding AB’s Capa™
caprolactone business (the “acquisition”); the anticipated timing and
closing of the acquisition; capital and other expenditures; competitive
positions; growth opportunities for existing products; benefits from new
technology and cost-reduction initiatives, plans and objectives; and
markets for securities. Like other businesses, Ingevity is subject to
risks and uncertainties that could cause its actual results to differ
materially from its expectations or that could cause other
forward-looking statements to prove incorrect. Factors that could cause
actual results to materially differ from those contained in the
forward-looking statements, or that could cause other forward-looking
statements to prove incorrect, include, without limitation, risks
related to the satisfaction of the conditions to closing the acquisition
(including the failure to obtain necessary regulatory approvals) in the
anticipated time frame or at all; risks that the expected benefits from
the acquisition will not be realized or will not be realized in the
expected time period; the risk that the businesses will not be
integrated successfully; significant transaction costs; unknown or
understated liabilities; general economic and financial conditions;
international sales and operations; currency exchange rates and currency
devaluation; compliance with U.S. and foreign regulations; attracting
and retaining key personnel; conditions in the automotive market or
adoption of alternative technologies; worldwide air quality standards;
government infrastructure spending; declining volumes in the printing
inks market; the limited supply of crude tall oil (“CTO”); lack of
access to sufficient CTO; access to and pricing of raw materials;
competition from producers of substitute products and new technologies;
and new or emerging competitors; a prolonged period of low energy
prices; the provision of services by third parties at several
facilities; natural disasters, such as hurricanes, winter or tropical
storms, earthquakes, floods, fires; other unanticipated problems such as
labor difficulties including renewal of collective bargaining
agreements, equipment failure or unscheduled maintenance and repair;
protection of intellectual property and proprietary information;
information technology security risks; government policies and
regulations, including, but not limited to, those affecting the
environment, climate change, tax policies, tariffs and the chemicals
industry; and lawsuits arising out of environmental damage or personal
injuries associated with chemical or other manufacturing processes.
These and other important factors that could cause actual results or
events to differ materially from those expressed in forward-looking
statements that may have been made in this document are and will be more
particularly described in our filings with the U.S. Securities and
Exchange Commission, including our Form 10-K for the year ended December
31, 2017 and our other periodic filings. Readers are cautioned not to
place undue reliance on Ingevity’s projections and forward-looking
statements, which speak only as the date thereof. Ingevity undertakes no
obligation to publicly release any revision to the projections and
forward-looking statements contained in this announcement, or to update
them to reflect events or circumstances occurring after the date of this
announcement.
Laura Woodcock
843-746-8197
laura.woodcock@ingevity.com
Investors:
Dan Gallagher
843-740-2126
daniel.gallagher@ingevity.com