Synthomer Plc, the UK-based manufacturer of latices and speciality emulsion polymers, has acquired Hexion Performance Adhesives & Coatings (Hexion PAC), a business of the US-based Hexion Inc, for the total consideration $ 226 million. The acquisition is expected to complete during the summer 2016 following receipt of regulatory approvals and satisfaction of other closing conditions.
Hexion PAC develops, manufactures and markets a wide array of dispersions, additives, powder coatings and speciality monomers, supplying a global customer base across a broad range of end-use including coatings, adhesives and for building and construction applications. The business employs approximately 750 employees and operates 7 sites across Europe, the US and Asia. In 2015, Hexion PAC generated sales of $ 370 million and EBITDA of $30 million. It is expected that the acquisition will be earnings enhancing for Synthomer in the first full year. The existing leadership team of Hexion PAC will transfer with the business to Synthomer.
The acquisition of Hexion PAC significantly strengthens Synthomer’s position in the performance adhesives and coatings market, offering access to new product technologies, customers and markets. Hexion PAC is also highly complementary to Synthomer’s existing business both geographically and in the markets in which it operates. Following completion, the Group will have a stronger platform from which to continue its growth aspirations in the speciality coatings market. Synthomer expects to achieve approximately $ 12 million of annualised synergies by end 2018 through the integration of Hexion PAC’s businesses into the Group. The estimated costs to achieve the synergies are $ 9 million of restructuring costs and $ 12 million of capital costs.
Calum MacLean, chief executive of?cer of Synthomer, said, “The acquisition of Hexion PAC represents a further step forward in our strategy to continue to grow and develop the business. This acquisition strengthens our platform for continued growth in the global dispersions and additives market, and in particular expands our presence in the US and Asia.”
