Hexion Inc. recently announced that it has entered into a definitive agreement to sell its phenolic specialty resin, hexamine, and Europe-based forest products resins businesses for approximately $425 million to Black Diamond and Investindustrial. The consideration consists of $335 million in cash and certain assumed liabilities, with the remainder in future proceeds based on the performance of the business.
Together, these businesses posted sales of approximately $530 million (for the last 12 months ended June 30, 2020). The transaction includes approximately 900 associates and 11 manufacturing facilities globally, where phenolic specialty resins and engineered thermoset molding compounds are produced for a range of end markets such as building and construction, industrial, automotive, electronics, agriculture, and consumer.
Hexion reportedly expects to use the sale proceeds to invest in its business and further reduce its debt. The transaction is intended to close in the first quarter of 2021, subject to regulatory approvals and other customary closing conditions, including Works Council consultation.
“We continue to strategically manage our portfolio providing us the ability to further strengthen our balance sheet and maintain a strong business going forward,” said Craig Rogerson, Hexion’s chairman, president, and CEO. “As we proceed, we will leverage our differentiated technology and global manufacturing footprint to serve the diversified customers of our remaining businesses. On behalf of everyone at Hexion, I would like to thank our associates within our Phenolic Specialty Resins, Hexamine and European-based Forest Products Resins businesses for their many contributions. I am confident they will have exciting opportunities ahead.”