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Huntsman announces sale of its India-based DIY consumer adhesives business

November 03/2020

MOSCOW (MRC) -- Huntsman Corporation announced that it has entered into a definitive agreement to sell its India based Do-It-Yourself (DIY) consumer adhesives business, part of the Advanced Materials division, to Pidilite Industries Ltd. in an all-cash transaction valued at up to USD285 million, excluding customary working capital and other adjustments, as per the company's press release.

The transaction value represents a 2019 adjusted EBITDA multiple of approximately 15 times. Under the terms of the agreement Huntsman will receive approximately USD257 million in cash at closing and up to approximately USD28 million of additional cash under an earn out within 18 months if the business achieves sales revenue in-line with 2019. The transaction is expected to close within the coming week.

Peter Huntsman, Chairman, President and CEO commented: "We have taken this business and built it from almost nothing to be a market leader in India. To take it to the next level of size and value, we simply do not have the footprint in India to do so. Pidilite is a respected leader in consumer adhesives within India and is in a better position to invest in and more aggressively grow this consumer DIY business over the coming years. We anticipate within the coming months that we will be able to deploy the proceeds from this asset and replace the lost EBITDA with other growth assets that fit even better within our core Advanced Materials specialty business."

As MRC reported earlier, Nanjing Jinling Huntsman, a joint venture between Huntsman and Sinopec Jinling, planned to shut its propylene oxide plant in Nanjing (Nanjing, Jiangsu Province, China) on November 1 for scheduled maintenance. This plant with a capacity of 240,000 tonnes/year of propylene oxide will be closed until approximately 25 November.

According to MRC's ScanPlast report, PP shipments to the Russian market reached 880,130 tonnes in the nine months of 2020 (calculated using the formula: production minus exports plus imports, exluding producers' inventories as of 1 January, 2020). Supply increased exclusively of PP random copolymer.

Huntsman Corporation is a publicly traded global manufacturer and marketer of differentiated and specialty chemicals with 2019 revenues of approximately USD7 billion. The company's chemical products number in the thousands and are sold worldwide to manufacturers serving a broad and diverse range of consumer and industrial end markets. The company operates more than 70 manufacturing, R&D and operations facilities in approximately 30 countries and employ approximately 9,000 associates within our four distinct business divisions.


mrcplast.com
Author:Margaret Volkova
Tags:PP, PP random copolymer, propylene, petrochemistry, adhesives, Huntsman, India, China, Russia.
Category:General News
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