Hudson Technologies Announces Closing of Acquisition of Airgas-Refrigerants, Inc.
October 10 2017 - 5:26PM
Business Wire
Hudson Technologies, Inc. (NASDAQ:HDSN) (“Hudson”) today
announced the closing of its acquisition of Airgas-Refrigerants,
Inc. (“ARI”), a subsidiary of Airgas, Inc., an Air Liquide company
and leading U.S. supplier of industrial gases. The transaction is
valued on a gross basis at approximately $220 million. ARI is a
leading refrigerant distributor and EPA certified reclaimer in the
U.S. ARI distributes, reclaims and packages refrigerant gases for a
variety of end uses.
The trailing twelve month revenue through June 30, 2017 for ARI
was approximately $142 million, and trailing 12 month pro forma
revenue of the combined business as of June 30, 2017 was
approximately $275 million. The acquisition is expected to be
accretive to earnings beginning one year following the close of the
transaction due to certain purchase price allocation adjustments,
primarily to inventory, which will impact Hudson’s 2018 Generally
Accepted Accounting Principles (“GAAP”) earnings per share.
Kevin J. Zugibe, Chairman and Chief Executive Officer of Hudson
Technologies commented, “We’re very pleased to have closed this
transformative acquisition which represents a milestone in our
Company’s history. The addition of ARI significantly strengthens
our leadership position in the refrigerant and reclamation industry
by enhancing our product offerings, increasing our geographic reach
and customer base and enhancing our sales and distribution
capabilities. This strategic combination considerably increases the
scale of our company which will allow us to better serve our
customers during the ongoing phase out of HCFC refrigerants and as
the industry continues its transition to next generation HFC
refrigerants, which have also been identified for future phase
down. We welcome ARI’s experienced management team and employees
and look forward to working together to serve our existing and new
customers with our expanded product and service capabilities.”
The acquisition was financed with available cash balances, plus
total borrowings of approximately $185 million under an enhanced
asset based lending facility of $150 million from PNC Bank and
under a new term loan from funds advised by FS Investments and
sub-advised by GSO Capital Partners LP of $105 million. No
additional Hudson equity was issued to finance this
transaction.
William Blair & Co. acted as Hudson’s exclusive financial
advisor for the transaction and the law firm of Wiggin and Dana LLP
served as the Company’s legal counsel.
About Hudson Technologies
Hudson Technologies, Inc. is a leading provider of innovative
and sustainable solutions for optimizing performance and enhancing
reliability of commercial and industrial chiller plants and
refrigeration systems. Hudson's proprietary RefrigerantSide®
Services increase operating efficiency, provide energy and cost
savings, reduce greenhouse gas emissions and the plant’s carbon
footprint while enhancing system life and reliability of operations
at the same time. RefrigerantSide® Services can be performed at a
customer's site as an integral part of an effective scheduled
maintenance program or in response to emergencies. Hudson also
offers SMARTenergy OPS®, which is a cloud-based Managed Software as
a Service for continuous monitoring, Fault Detection and
Diagnostics and real-time optimization of chilled water plants. In
addition, the Company sells refrigerants and provides traditional
reclamation services for commercial and industrial air conditioning
and refrigeration uses. For further information on Hudson, please
visit the Company's web site at www.hudsontech.com.
Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995
Statements contained herein which are not historical facts
constitute forward-looking statements. These include statements
regarding management’s intentions, plans, beliefs, expectations or
forecasts for the future including, without limitation, Hudson’s
expectations with respect to the benefits, costs and other
anticipated financial impacts of the proposed ARI transaction;
future financial and operating results of the company; and the
company’s plans, objectives, expectations and intentions with
respect to future operations and services. Such forward-looking
statements involve a number of known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of the Company to be materially
different from any future results, performance or achievements
expressed or implied by such forward-looking statements. Such
factors include, but are not limited to, changes in the laws and
regulations affecting the industry, changes in the demand and price
for refrigerants (including unfavorable market conditions adversely
affecting the demand for, and the price of, refrigerants), the
Company's ability to source refrigerants, regulatory and economic
factors, seasonality, competition, litigation, the nature of
supplier or customer arrangements that become available to the
Company in the future, adverse weather conditions, possible
technological obsolescence of existing products and services,
possible reduction in the carrying value of long-lived assets,
estimates of the useful life of its assets, potential environmental
liability, customer concentration, the ability to obtain financing,
any delays or interruptions in bringing products and services to
market, the timely availability of any requisite permits and
authorizations from governmental entities and third parties as well
as factors relating to doing business outside the United States,
including changes in the laws, regulations, policies, and
political, financial and economic conditions, including inflation,
interest and currency exchange rates, of countries in which the
Company may seek to conduct business, the Company’s ability to
successfully integrate any assets it acquires from third parties
into its operations, and other risks detailed in the Company's 10-K
for the year ended December 31, 2016 and other subsequent filings
with the Securities and Exchange Commission. Examples of such risks
and uncertainties specific to the proposed ARI transaction include,
but are not limited to, the possibility that the expected benefits
will not be realized, or will not be realized within the expected
time period. The words "believe", "expect", "anticipate", "may",
"plan", "should" and similar expressions identify forward-looking
statements. Readers are cautioned not to place undue reliance on
these forward-looking statements, which speak only as of the date
the statement was made.
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version on businesswire.com: http://www.businesswire.com/news/home/20171010006704/en/
Investor Relations:Institutional Marketing Services
(IMS)John Nesbett/Jennifer Belodeau,
203-972-9200jnesbett@institutionalms.comorCompany:Hudson
Technologies, Inc.Brian F. Coleman, 845-735-6000President &
COObcoleman@hudsontech.com
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