mg technologies sells Dynamit Nobel
mg technologies ag sells its participation in Dynamit Nobel AG, excluding the plastics business, which is currently in negotiations with separate bidders. The purchase price amounts to Euro 2.25 billion. The acquirer is Rockwood Specialties Group Inc., a U.S.-based specialty chemicals company. The transaction does not include the plastics division, since it is predominantly an automotive supplier. To finance the acquisition, Rockwood will conduct a capital increase, which will be backed by Kohlberg Kravis Roberts & Co. L.P. (KKR), a leading private equity company, and Credit Suisse First Boston Private Equity (CSFB Private Equity). The four business units to be divested are CeramTec, Chemetall, Sachtleben and DNES (Custom Synthesis). With annual sales of Euro 1.5 billion they represent about two thirds of Dynamit Nobel’s overall sales and more than three quarters of its operative cash flows (EBITDA) in fiscal year 2003.
An agreement to this effect was notarized in the early morning. Financing for the transaction is already secured. Closing of the transaction is planned for the third quarter of 2004. Completion will be subject to approval by the supervisory board and annual general meeting of mg, as well as by the relevant antitrust authorities.
Substantial step in mg’s corporate re-alignment completed
Udo Stark, Chairman of the Executive Board of mg technologies ag, comments: „The sale of these four Dynamit Nobel business units is a substantial step towards mg’s corporate re-alignment that we decided on last fall. Furthermore, the combination of Dynamit Nobel and Rockwood will create a global leader in specialty chemicals and advance materials. Selling the businesses as a package to an industrial buyer with strong financial backing by two private equity firms is in the best interest of all parties including those of employees.” The divestment process for the two business units Dynamit Nobel Kunststoff GmbH (Plastics) and solvadis ag will continue as planned.
Significant expansion of growth opportunities
„As announced, the proceeds from this transaction will contribute to transform our current net debt position into a positive cash position. This substantially enhances our financial flexibility and creates a sound basis for future expansion via organic growth and acquisitions”, Udo Stark continued. The purchase price of Euro 2.25 billion represents the enterprise value of the four business units of Dynamit Nobel on a debt-free basis. The equity value will result from the pension liabilities and bank debts that the buyer will take over and will be derived from the closing balance sheet.
Global leader in specialty chemicals
Rockwood Specialties Group Inc. is a Princeton-based specialty chemicals business focused on inorganic pigments, a variety of specialty additives, specialty compounds and electronic chemicals. Rockwood had sales of approximately Euro 700 million in fiscal year 2003. Dynamit Nobel and Rockwood represent combined sales of about Euro 2.2 billion and count almost 10,000 employees worldwide.
About Dynamit Nobel AG
With around 12,300 employees worldwide, Dynamit Nobel AG had sales of about Euro 2.3 billion in 2003. This represents 36.4 percent of mg’s total sales. Dynamit Nobel AG is comprised of five businesses: Advanced Ceramics (CeramTec AG Innovative Ceramic Engineering), Specialty Chemicals (Chemetall GmbH), Pigments (Sachtleben Chemie GmbH), Custom Synthesis (Dynamit Nobel GmbH Explosivstoff- und Systemtechnik) and Plastics (Dynamit Nobel Kunststoff GmbH). Dynamit Nobel is an internationally active corporation that provides innovative specialty products for niche markets in many industries, including pharma and cosmetics as well as the chemical and automotive industries.
Based in Plochingen, Germany, CeramTec AG is a global leader in advanced ceramics. In 2003, the company’s sales amounted to Euro 254 million, with a headcount of 2,500 employees.
Frankfurt-based Chemetall GmbH is a leading global provider of innovative specialty chemicals in the areas of surface treatment, polymers and lithium. With sales of Euro 586 million and 2,400 employees, the company is the global No. 1 in lithium compounds and global No. 2 in surface treatment for metal processing.
Sachtleben Chemie GmbH, headquartered in Duisburg, Germany, produces white pigments, functional additives and water chemistry. The company is the world market leader in titanium dioxide in anatase form for synthetic fibres and in most of its functional additives application areas. In fiscal 2003, the company generated sales of Euro 339 million with approximately 1,200 employees.
Dynamit Nobel GmbH Explosivstoff- und Systemtechnik (DNES) is active in the fields of advanced intermediates and active ingredients (custom syntheses) for the life sciences industries. Located in Troisdorf, Germany, the company is the global No. 1 in hazardous chemistry for custom syntheses. In fiscal 2003, the company had sales of Euro 289 million with about 1,300 employees.
Dynamit Nobel Kunststoff GmbH, located in Weißenburg, Germany, is a leading European manufacturer of thermoplastic and thermosetting exterior plastics for the automotive industry. In fiscal 2003, the company had about 4,900 employees and generated sales of Euro 876 million.
About solvadis ag
solvadis ag, headquartered in Frankfurt, is the No. 5 in European chemical distribution. In fiscal 2003, the company generated sales of about Euro 1.4 billion with around 800 employees. This includes sales of about Euro 980 million of the French solvadis subsidiary Safic-Alcan that was sold in December 2003 to DLMD Holding and a private equity company.
About mg technologies ag
mg technologies is an international technology group with core competencies in engineering and chemicals. In the future the company will concentrate on specialty mechanical engineering – focusing on process engineering and components – and plant engineering. Excluding discontinued operations mg generated sales of Euro 6.4 billion in fiscal 2003. As of December 2003 mg employed around 30.800 people. The company is one of the world’s market and technology leaders in 90 percent of its businesses. mg is listed on the Frankfurt Stock Exchange and part of the MDAX index.
With more than Euro 3.8 billion in sales in fiscal 2003, the specialty mechanical engineering and plant engineering division substantially contributed to mg’s overall sales. The lion’s share is provided by GEA, with sales of about Euro 2.7 billion. The Bochum-based company is active in seven strategic business units and develops and supplies sophisticated, mostly tailor-made process lines, systems and components, for example for the food and pharma industries. GEA will be the core of the re-aligned mg and generate roughly 80 percent of its value added.
The remaining sales of the mechanical and plant engineering division is generated by three industrial plant engineering companies: Lurgi plans, supplies and constructs turnkey plants, mostly for the gas and oil industry and the petrochemical industry. Lurgi Lentjes focuses on the environment and energy-related business. Zimmer operates throughout the world in the area of plant engineering for the production of polymers and synthetic fibres.
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