Establishes Celanese as the Preeminent Global
Specialty Materials Company
- Acquisition expected to generate approximately $450 million of
synergies and be immediately accretive to adjusted EPS
- Acquisition expected to drive significant expansion of free
cash flow and swift deleveraging with total debt below 3.0x EBITDA
within two years of closing
Celanese Corporation (NYSE: CE), a global chemical and specialty
materials company, today announced the signing of a definitive
agreement to acquire a majority1 of the Mobility & Materials
(“M&M”) business of DuPont for $11.0 billion in cash. Celanese
will acquire a broad portfolio of engineered thermoplastics and
elastomers, industry-renowned brands and intellectual property,
global production assets, and a world-class organization.
“The acquisition of the M&M business is an important
strategic step forward and establishes Celanese as the preeminent
global specialty materials company,” said Lori Ryerkerk, Chairman
and Chief Executive Officer. “For nearly a decade, we have
implemented, enhanced, and increasingly extended the Engineered
Materials (“EM”) commercial model to generate shareholder value.
M&M will be a high-quality addition to EM and will unlock
significant opportunities to generate further customer and
shareholder value. We are eager to welcome the M&M team to
Celanese and jointly elevate the future growth and cash generation
of the combined Celanese portfolio.”
“The M&M business is a uniquely complementary specialty
materials asset to EM, spanning product, geography, and
end-market,” said Tom Kelly, Senior Vice President Engineered
Materials. “This acquisition greatly enhances the EM product
portfolio by adding new polymers, industry-renowned brands, leading
product technology, and backward integration in critical polymers.
We are eager to combine the product and technology leadership of
M&M with the commercial excellence and customer engagement
model of EM to accelerate our growth in high-value applications
including future mobility, connectivity, and medical.”
Transaction Overview
The M&M business is a leading global producer of engineering
thermoplastics and elastomers serving a variety of end-uses
including automotive, electrical and electronics, consumer goods,
and industrial applications. The acquired M&M product portfolio
includes numerous specialty materials with global leadership
positions in nylons (PA 66, PA 6), specialty nylons (HPPA, LCPA,
filaments), polyesters (PET and PBT), and elastomers (TPC and EAE).
The M&M portfolio is highly functionalized to meet a wide
variety of application specifications and is supported by a leading
intellectual property portfolio and technology organization.
According to the terms of the definitive agreement, Celanese
will acquire a majority of the M&M business for a purchase
price of $11.0 billion on a cash-free, debt-free basis. As part of
the transaction, Celanese will acquire the following:
- A global production network of 29 facilities, including
compounding and polymerization
- Customer and supplier contracts and agreements
- Industry-leading intellectual property portfolio including
approximately 850 patents with associated technical and R&D
assets
- Approximately 5,000 highly-skilled employees across the
manufacturing, technical, and commercial organizations
Within the first four years following the close of the
transaction, Celanese expects to achieve run-rate synergies of
approximately $450 million as a result of the highly complementary
fit of the businesses. The acquisition is expected to be
immediately accretive to adjusted earnings per share with
anticipated accretion of $4.00 or more per share once full
synergies are achieved by 2026.
The acquisition is expected to be fully-financed with committed
debt financing at the time of closing. Significant expansion of
free cash flow and swift deleveraging is expected to support a
reduction of total debt to below 3.0x EBITDA within two years of
closing the transaction.
“Robust and growing cash generation and a strong balance sheet
enable us to fully finance this acquisition with committed debt
financing while maintaining our investment grade credit profile,”
said Scott Richardson, Executive Vice President, Chief Financial
Officer. “M&M has historically been a strong generator of cash
flow. We are confident in our ability to capture synergies that
would allow us to double Celanese total free cash flow within the
next five years.”
Additional Transaction Details
The transaction is subject to regulatory approvals and customary
closing conditions. The transaction is expected to close around the
end of 2022.
DuPont has agreed to retain and indemnify Celanese for certain
liabilities, including liabilities relating to PFAS.
Celanese is advised by Kirkland & Ellis LLP as principal
legal counsel, Gibson, Dunn & Crutcher LLP as financing
counsel, and BofA Securities as financial advisor.
Conference Call
Celanese management will host a conference call on Friday,
February 18 at 8:30 a.m. Eastern time.
The Company’s presentation and accompanying prepared remarks
covering this transaction can be found on its website at
investors.celanese.com under News & Events/Events Calendar.
This call will be available by webcast at
https://investors.celanese.com or by phone:
Dial-in Number: 1-877-407-0989 International
Dial-In Number: 1-201-389-0921 Ask for the Celanese Webcast
Alternatively, to enter the call immediately without waiting for
operator assistance, attendees may pre-register for the call by
clicking the link below.
Registrant Link:
http://services.incommconferencing.com/DiamondPassRegistration/register?confirmationNumber=13727383&linkSecurityString=11dc30980c
A replay of the conference call will be available on demand on
February 18, 2022, from 10:30 a.m. Eastern time until March 4,
2022, 12:00 a.m. Eastern time, at the following number:
Replay Number: 1-877-660-6853 Passcode:
13727383
The replay and transcript will be available on demand at
investors.celanese.com. The materials will be furnished with the
Securities and Exchange Commission on a Form 8-K prior to the
call.
1 Excluding the Delrin® POM, Tedlar® PVF, Multibase, and Auto
Adhesives & Fluids businesses.
About Celanese
Celanese Corporation is a global chemical leader in the
production of differentiated chemistry solutions and specialty
materials used in most major industries and consumer applications.
Our businesses use the full breadth of Celanese's global chemistry,
technology and commercial expertise to create value for our
customers, employees, shareholders and the corporation. As we
partner with our customers to solve their most critical business
needs, we strive to make a positive impact on our communities and
the world through The Celanese Foundation. Based in Dallas,
Celanese employs approximately 8,500 employees worldwide and had
2021 net sales of $8.5 billion. For more information about Celanese
Corporation and its product offerings, visit www.celanese.com.
Forward-Looking Statements: This release may contain
“forward-looking statements,” which include information concerning
the Company’s plans, objectives, goals, strategies, future
revenues, cash flow, synergies, performance, capital expenditures
and other information that is not historical information. When used
in this release, the words “outlook,” “forecast,” “estimates,”
“expects,” “anticipates,” “projects,” “plans,” “intends,”
“believes,” “will” and variations of such words or similar
expressions are intended to identify forward-looking statements.
All forward-looking statements are based upon current expectations
and beliefs and various assumptions. There can be no assurance that
the Company will realize these expectations or that these beliefs
will prove correct. There are a number of risks and uncertainties
that could cause actual results to differ materially from the
results expressed or implied by the forward-looking statements
contained in this release. These include the Company’s ability to
obtain regulatory approval for, and satisfy closing conditions to,
the transactions described herein, the timing of closing thereof,
and the Company’s ability to realize the anticipated benefits of
the transaction. Numerous other factors, many of which are beyond
the Company’s control, could cause actual results to differ
materially from those expressed as forward-looking statements.
Other risk factors include those that are discussed in the
Company’s filings with the Securities and Exchange Commission. Any
forward-looking statement speaks only as of the date on which it is
made, and the Company undertakes no obligation to update any
forward-looking statements to reflect events or circumstances after
the date on which it is made or to reflect the occurrence of
anticipated or unanticipated events or circumstances.
Non-GAAP Financial
Measures
This release, and statements made in connection with this
release, refer to non-GAAP financial measures. For more information
on the historical non-GAAP financial measures used by the Company,
including the most directly comparable GAAP financial measure for
each historical non-GAAP financial measures used, including
definitions and reconciliations of the differences between such
non-GAAP financial measures and the comparable GAAP financial
measures, please refer to the Non-US GAAP Financial Measures and
Supplemental Information document available on our website,
investors.celanese.com, under Financial Information/Non-GAAP
Financial Measures.
We do not provide reconciliations for Adjusted EBIT, Operating
EBITDA or adjusted earnings per share on a forward-looking basis
(including those contained in this document) when we are unable to
provide a meaningful or accurate calculation or estimation of
reconciling items and the information is not available without
unreasonable effort. This is due to the inherent difficulty of
forecasting the timing and amount of Certain Items, such as
mark-to-market pension gains and losses, that have not yet
occurred, are out of our control and/or cannot be reasonably
predicted. Due to high variability and difficulty in predicting
items that impact cash from operating activities, capital
expenditures and distributions to certain noncontrolling interests,
we are unable to provide a reconciliation between projected free
cash flow and net cash provided by (used in) operations without
unreasonable effort. For the same reasons, we are unable to address
the probable significance of the unavailable information.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220218005114/en/
Celanese Contacts: Investor Relations Brandon
Ayache +1 972 443 8509 brandon.ayache@celanese.com
Media Relations – Global W. Travis Jacobsen +1 972 443
3750 william.jacobsen@celanese.com
Media Relations Europe (Germany) Petra Czugler +49 69
45009 1206 petra.czugler@celanese.com
Celanese (NYSE:CE)
Historical Stock Chart
From Mar 2024 to Apr 2024
Celanese (NYSE:CE)
Historical Stock Chart
From Apr 2023 to Apr 2024