NORTH CHARLESTON, S.C.--(BUSINESS WIRE)--Ingevity Corporation (NYSE:NGVT) today announced it has reached an agreement with Perstorp Holding AB to acquire the Capa 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.
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.
