Ferro Completes Acquisition of Cappelle Pigments
December 09 2016 - 9:00AM
Business Wire
Producer of specialty, high-performance
inorganic and organic pigments enhances Ferro’s color solutions
portfolio
Ferro Corporation (NYSE: FOE, the “Company”), announced today
that it has completed the previously announced acquisition of
Belgium-based Cappelle Pigments (“Cappelle”), a leader in
specialty, high-performance inorganic and organic pigments used in
coatings, inks and plastics, for €50.5 million (approximately $54
million) on a cash-free and debt-free basis. The acquisition was
previously announced on October 17, 2016. The transaction was
funded through excess cash and borrowings under the Company’s
existing revolving credit facility.
Cappelle is a 125-year-old premium pigment producer and a market
leader in inorganic pigments. Cappelle's pigments complement
Ferro’s market leadership positions in Complex Inorganic Colored
Pigments (“CICPs”) and Ultramarine Blue pigments. Cappelle has a
strong reputation in Bismuth Vanadates, offering yellow, orange and
red shade varieties, which provide an environmentally friendly
alternative to lead chromates in high-performance applications.
Cappelle's organic pigments offer superior heat, light and
environmental wear resistance.
“This acquisition strengthens our color solutions business by
facilitating our expansion into the high-performance, specialty
organic pigment market and complementing our inorganic pigment
portfolio,” said Peter Thomas, Chairman, President and CEO of Ferro
Corporation. “The transaction will significantly expand our
addressable market for pigments and increase sales in our Pigments,
Powders and Oxides (“PPO”) business by approximately $70 million.
Pigments produced by Cappelle and Ferro can be combined or blended
with other mediums to produce specialized color solutions that
enhance functionality and effectiveness of our customers’ end
products while improving customers’ efficiency. We are delighted to
welcome the Cappelle team to Ferro and are eager to leverage the
enhanced capabilities that the acquisition provides.”
About Ferro Corporation
Ferro Corporation (http://www.ferro.com) is a leading
global functional coatings and color solutions company that
supplies technology-based performance materials, including
glass-based coatings, pigments and colors, and polishing materials.
Ferro products are sold into the building and construction,
automotive, appliances, electronics, household furnishings, and
industrial products markets. Headquartered in Mayfield
Heights, Ohio, the Company has approximately 4,900 employees
globally and reported 2015 sales of $1.1 billion.
About Cappelle Pigments
Cappelle Pigments (www.Cappelle.be) is a privately owned
producer of high-grade organic and inorganic pigments. The company
is headquartered in Belgium with an additional production site in
France and has 230 employees. Cappelle Pigments has worldwide
representation and sales in more than 75 countries. Main products
are Bismuth Vanadate, transparent iron oxide and organic
high-performance pigments.
Cautionary Note on Forward-Looking Statements
Certain statements in this press release may constitute
"forward-looking statements" within the meaning of Federal
securities laws. These statements are subject to a variety of
uncertainties, unknown risks, and other factors concerning the
Company's operations and business environment. Important factors
that could cause actual results to differ materially from those
suggested by these forward-looking statements and that could
adversely affect the Company's future financial performance include
the following:
- Ferro's ability to complete
acquisitions, effectively integrate the businesses and achieve the
expected synergies (including the Cappelle Pigments, ESL, Delta,
Pinturas Benicarló, Ferer, and Al Salomi transactions), as
well as the acquisitions being accretive and Ferro achieving the
expected returns on invested capital;
- Ferro's ability to successfully
implement and/or administer its cost-saving initiatives, including
its restructuring programs, and to produce the desired
results;
- demand in the industries into which
Ferro sells its products may be unpredictable, cyclical, or heavily
influenced by consumer spending;
- the effectiveness of the Company's
efforts to improve operating margins through sales growth, price
increases, productivity gains, and improved purchasing
techniques;
- currency conversion rates and economic,
social, political, and regulatory conditions around the world;
- Ferro's ability to successfully
introduce new products or enter into new growth markets;
- the impact of interruption, damage to,
failure, or compromise of the Company's information systems;
- restrictive covenants in the Company's
credit facilities could affect its strategic initiatives and
liquidity;
- Ferro's ability to access capital
markets, borrowings, or financial transactions;
- the availability of reliable sources of
energy and raw materials at a reasonable cost;
- increasingly aggressive domestic and
foreign governmental regulations on hazardous materials and
regulations affecting health, safety and the environment;
- sale of products into highly regulated
industries;
- limited or no redundancy for certain of
the Company's manufacturing facilities and possible interruption of
operations at those facilities;
- competitive factors, including intense
price competition;
- Ferro's ability to protect its
intellectual property or to successfully resolve claims of
infringement brought against it;
- the impact of operating hazards and
investments made in order to meet stringent environmental, health
and safety regulations;
- management of Ferro's general and
administrative expenses;
- Ferro's multi-jurisdictional tax
structure and its ability to reduce its effective tax rate,
including the impact of the Company's performance on its ability to
utilize significant deferred tax assets;
- the effectiveness of strategies to
increase Ferro's return on invested capital, and the short-term
impact that acquisitions may have on return on invested
capital;
- stringent labor and employment laws and
relationships with the Company's employees;
- the impact of requirements to fund
employee benefit costs, especially post-retirement costs;
- implementation of new business
processes and information systems, including the outsourcing of
functions to third parties;
- risks associated with the manufacture
and sale of material into industries making products for sensitive
applications;
- exposure to lawsuits in the normal
course of business;
- risks and uncertainties associated with
intangible assets;
- Ferro's borrowing costs could be
affected adversely by interest rate increases;
- liens on the Company's assets by its
lenders affect its ability to dispose of property and
businesses;
- Ferro may not pay dividends on its
common stock in the foreseeable future;
- amount and timing of any repurchase of
Ferro's common stock; and
- other factors affecting the Company's
business that are beyond its control, including disasters,
accidents and governmental actions.
The risks and uncertainties identified above are not the only
risks the Company faces. Additional risks and uncertainties not
presently known to the Company or that it currently believes to be
immaterial also may adversely affect the Company. Should any known
or unknown risks and uncertainties develop into actual events,
these developments could have material adverse effects on our
business, financial condition and results of operations.
This release contains time-sensitive information that reflects
management's best analysis only as of the date of this release. The
Company does not undertake any obligation to publicly update or
revise any forward-looking statements to reflect future events,
information, or circumstances that arise after the date of this
release. Additional information regarding these risks can be found
in our Annual Report on Form 10-K for the period
ended December 31, 2015.
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version on businesswire.com: http://www.businesswire.com/news/home/20161209005317/en/
Ferro CorporationInvestor Contact:Kevin Cornelius Grant,
216-875-5451Manager, Investor
Relationskevincornelius.grant@ferro.comorMedia Contact:Mary Abood,
216-875-5401Director, Corporate
Communicationsmary.abood@ferro.com
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