- FMC will acquire the portion of DuPont's Crop Protection
business required to be divested by a European Commission ruling
related to DuPont's merger with The Dow Chemical Company.
- DuPont will acquire FMC Health and Nutrition.
- FMC will make a cash payment to DuPont of $1.2 billion.
- These transactions will be immediately accretive to FMC's
adjusted earnings per share, upon closing.(1)
PHILADELPHIA, March 31, 2017 /PRNewswire/ -- FMC Corporation
(NYSE: FMC) and DuPont (NYSE: DD) today announced the signing of a
definitive agreement for FMC to acquire the portion of DuPont's
Crop Protection business it must divest to comply with the European
Commission ruling related to its merger with The Dow Chemical
Company. Additionally, DuPont will acquire FMC Health and
Nutrition and receive $1.2 billion in
cash. FMC will acquire DuPont's global chewing pest
insecticide portfolio, its global cereal broadleaf herbicides, and
a substantial portion of DuPont's global crop protection R&D
capabilities. In 2017, FMC expects this acquired business
will generate approximately $1.5
billion in revenue and $475
million of EBITDA.2
Logo -
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After closing of the acquisition, FMC Agricultural Solutions
will become the fifth largest crop protection chemical company in
the world by revenue, with estimated annual revenue of
approximately $3.8 billion.
"This is a significant step forward for FMC, and for our
Agricultural Solutions business in particular," said Pierre
Brondeau, FMC president, CEO and chairman. "The combination
of market-leading products from DuPont's crop protection portfolio
and its world-class R&D capabilities will transform our
Agricultural Solutions business into a tier-one ag technology
company.
"The crop protection industry is undergoing significant change,
as evidenced by the consolidation currently underway. To
continue to meet the demands of our customers, FMC needs to provide
more options to growers looking for innovative solutions that
protect crops and increase yields. By combining these
high-value products and R&D capabilities with our own product
portfolio, pipeline and formulation expertise, FMC will be able to
serve our customers better and accelerate the pace at which we
bring new solutions to the market," said Brondeau. "The
concurrent sale of our Health and Nutrition business will allow us
to maintain our strong balance sheet and ensure we can continue to
invest in growing both our Agricultural Solutions and Lithium
segments."
The Crop Protection Business Being Acquired
The acquired portion of DuPont's crop protection business
includes an industry-leading selective insecticide portfolio
consisting of Rynaxypyr®, Cyazypyr® and
Indoxacarb. The first two of these products have full patent
protection over their respective active ingredients, and FMC
expects these products will generate over $1
billion in 2017 revenue. These selective insecticides
are highly complementary to FMC's existing broad spectrum
insecticide portfolio.
The acquired portfolio also includes DuPont's global cereal
broadleaf herbicides, consisting of nine active ingredients and
multiple formulated products. This herbicide portfolio comes
with strong, recognized brands and DuPont's proprietary
PrecisionPac® technology. These products bring
significant diversification to FMC's crop exposure in herbicides,
as well as increasing the balance of pre-emergent and post-emergent
applications in FMC's portfolio.
The geographic spread of the revenue in this portfolio will
result in a significant increase in FMC's presence in Asia and Europe. Following the
acquisition, FMC's crop protection revenue will be almost equally
spread across all four major regions – North America, Latin
America, Europe and
Asia.
The underlying intellectual property related to the acquired
products, including patents, registrations and data packages, will
be transferred to FMC. FMC will acquire a global
manufacturing network to fully support these products, including
four active ingredient manufacturing facilities and 10 regional
formulation plants.
The acquisition will bring DuPont's world-class discovery and
development organization, including its Delaware crop protection research
headquarters, 14 regional development labs and related regulatory
capabilities. This organization includes a pipeline of 15
synthetic active ingredients currently in development, covering
insecticides, herbicides and fungicides, and an extensive library
of 1.8 million synthetic compounds. The majority of DuPont's
crop protection research workforce will transfer to FMC as part of
this transaction.
FMC Health and Nutrition Divestiture
FMC Health and Nutrition will become part of DuPont's Nutrition
& Health segment.
"FMC Health and Nutrition is a highly profitable business with
leading positions across the vast majority of its portfolio, deep
applications knowledge and an extensive global network of
laboratories and manufacturing facilities. It is a very
complementary fit with DuPont's current portfolio. We are
confident it will thrive under DuPont's leadership and will
contribute to their successful Nutrition & Health business,"
said Brondeau.
Additional Information
The transaction is subject to the closing of the Dow and DuPont
merger, as well as customary closing conditions and regulatory
approvals. Closing is expected to occur in the fourth quarter
of 2017. FMC expects this transaction to be immediately
accretive to adjusted earnings per share, and will give updated
guidance for 2017 at its earnings call scheduled for May 2, 2017.
Dyal Co. LLC and Citi acted as financial advisors and Wachtell,
Lipton, Rosen & Katz acted as legal counsel to FMC. Citi
provided financing advice and committed debt facilities.
Conference Call
The company will host a webcast conference call on Friday, March 31, 2017, at 8:00 a.m. ET that is open to the public via
internet broadcast and telephone.
Internet broadcast: http://www.fmc.com
Passcode: FMC
Dial-in telephone numbers:
U.S. / Canada: (800)
230-1059
International: (612)
332-0226
Conference ID # 421549
A replay of the call will be available via the internet and
telephone from 10:00 a.m. ET on
Friday, March 31, 2017 until
Sunday, April 30, 2017.
Internet replay: http://www.fmc.com
U.S. / Canada: (800)
475-6701
International: (320)
365-3844
Conference ID # 421549
About FMC
For more than a century, FMC Corporation has served
the global agricultural, industrial and consumer markets with
innovative solutions, applications and quality products.
Revenue totaled approximately $3.3 billion in 2016.
FMC employs approximately 6,000 people throughout the world and
operates its businesses in three segments: FMC Agricultural
Solutions, FMC Health and Nutrition and FMC Lithium. For
more information, visit www.FMC.com.
About DuPont
DuPont (NYSE: DD) has been bringing world-class science and
engineering to the global marketplace in the form of innovative
products, materials, and services since 1802. The company believes
that by collaborating with customers, governments, NGOs, and
thought leaders we can help find solutions to such global
challenges as providing enough healthy food for people everywhere,
decreasing dependence on fossil fuels, and protecting life and the
environment. For additional information about DuPont and its
commitment to inclusive innovation, please visit
www.dupont.com.
Safe Harbor Statement under the Private Securities Act of
1995: Statements in this news release that are forward-looking
statements are subject to various risks and uncertainties
concerning specific factors described in FMC
Corporation's 2016 Form 10-K and
other SEC filings. Such information
contained herein represents management's best judgment as of the
date hereof based on information currently
available. FMC Corporation does not intend
to update this information and disclaims any legal obligation to
the contrary. Historical information is not necessarily indicative
of future performance.
This press release contains certain "non-GAAP financial
terms" which are defined on our website www.fmc.com. In
addition, we have also provided on our website at
www.fmc.com reconciliations of non-GAAP terms to the most
directly comparable GAAP term.
- Although FMC provides forecasts for adjusted earnings per share
and adjusted cash from operations (both of which are non-GAAP
financial measures), FMC is not able to forecast the most directly
comparable measures calculated and presented in accordance with
GAAP. Certain elements of the composition of the GAAP amounts
are not predictable, making it impractical for us to
forecast. Such elements include, but are not limited to
restructuring, acquisition charges, and discontinued operations and
related cash activity. As a result, no GAAP outlook is
provided.
- Represents FMC's estimate of the 2017 EBITDA of the acquired
business, if it were a standalone business. EBITDA is a
non-GAAP financial term and represents earnings before interest,
taxes, depreciation, and amortization.