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Under the proposed transaction, OMNOVA will pay €227.5 million (approximately $300 million) for Eliokem. OMNOVA intends to raise $425 million of new long-term debt to fund the transaction and the repayment of all existing OMNOVA and Eliokem debt. In addition, OMNOVA intends to extend and increase the size of its unused asset-based credit facility to $100 million and expects to have $40 million of cash at the closing of the acquisition. The company expects the transaction to be neutral to slightly dilutive to earnings in 2011, but accretive in 2012.
“This acquisition will transform OMNOVA Solutions into a much larger, more diverse specialty chemical and functional surfaces company with significantly enhanced global capability,” said Kevin McMullen, OMNOVA chairman and CEO. “It is an excellent fit with OMNOVA’s strategy to grow in existing markets, penetrate new adjacent markets and globalize our company.”
For more information, visit www.omnova.com.