W. R. Grace & Co. (NYSE: GRA), a leading global specialty
chemical company and Standard Industries Holdings Inc., the parent
company of Standard Industries, a privately held global industrial
company, today announced that they have entered into a definitive
agreement under which Standard Industries Holdings will acquire
Grace in an all-cash transaction valued at approximately $7.0
billion, including Grace’s pending pharma fine chemistry
acquisition. Standard Industries’ related investment platform 40
North Management LLC (“40 North”) is a long-standing shareholder of
Grace.
Under the terms of the agreement, Standard Industries Holdings
will acquire all of the outstanding shares of Grace common stock
for $70.00 per share in cash. The purchase price represents a
premium of approximately 59% over Grace’s closing stock price of
$44.05 on November 6, 2020, the last trading day prior to the
announcement of 40 North’s initial proposal to acquire the Company
on November 9, 2020. The Grace Board of Directors unanimously
approved the transaction.
David Millstone and David Winter, Co-CEOs of Standard Industries
Holdings, said, “We are thrilled to welcome Grace to the Standard
Industries family and look forward to working with its exceptional
team to usher in a new era of innovation and growth for Grace, its
employees, customers and the communities in which it operates.”
“We are confident that our agreement with Standard Industries
Holdings is the best path forward for Grace and our shareholders,”
said Hudson La Force, Grace’s President and Chief Executive
Officer. “Standard’s $7 billion investment in Grace reflects their
confidence in the significant growth opportunities we have and
enables our shareholders to realize immediate value at a
significant cash premium. This announcement is a testament to the
strengths of our talented employees, industry-leading technologies,
and deep global customer relationships.”
The closing of the transaction is subject to customary closing
conditions, including approval by Grace shareholders and the
receipt of certain regulatory approvals. The transaction is not
contingent upon the receipt of financing. Financing commitments
have been provided by J.P. Morgan, BNP Paribas, Citi and Deutsche
Bank, and investment funds affiliated with Apollo Global Management
as capital partner.
40 North, a holder of 14.9% of shares of Grace common stock, has
entered into a voting agreement with Grace, pursuant to which it
has agreed, among other things, to vote its shares of Grace common
stock in favor of the transaction.
Consistent with the terms of the merger agreement, the Company
will suspend payment of a dividend going forward.
In light of this announcement, Grace will issue its first
quarter 2021 earnings results on May 6, 2021, but will not be
hosting an earnings conference call.
The parties expect the transaction to close in the fourth
quarter of 2021. Upon completion of the transaction, Grace will
become a privately held company and Grace’s common stock will no
longer be listed on the New York Stock Exchange.
Grace will operate as a standalone company within the portfolio
of Standard Industries Holdings, which includes Standard
Industries’ industry leading businesses GAF, BMI Group, Schiedel,
Siplast, SGI and GAF Energy.
Advisors
Goldman Sachs & Co. LLC and Moelis & Company LLC are
serving as financial advisors and Wachtell, Lipton, Rosen &
Katz is serving as legal counsel to Grace.
Citi and J.P. Morgan are serving as financial advisors and
Sullivan & Cromwell LLP is serving as legal counsel to Standard
Industries Holdings.
About GraceBuilt on talent, technology, and
trust, Grace is a leading global specialty chemical company. The
company’s two industry-leading business segments—Catalysts
Technologies and Materials Technologies—provide innovative
products, technologies, and services that enhance the products and
processes of our customers around the world. With approximately
4,000 employees, Grace operates and/or sells to customers in over
60 countries. More information about Grace is available at
grace.com.
About Standard Industries HoldingsStandard
Industries Holdings is the parent company of Standard Industries, a
privately-held global industrial company operating in over 80
countries with over 15,000 employees. The Standard ecosystem spans
a broad array of holdings, technologies and investments—including
both public and private companies from early to late-stage—as well
as world-class building materials assets and next-generation solar
solutions. Throughout its 140-year history, Standard has leveraged
its deep industry expertise and vision to create outsize value
across its businesses, which today include operating companies GAF,
BMI, Siplast, GAF Energy, Schiedel and SGI, as well as related
businesses 40 North, a multi-billion-dollar investment platform, 40
North Ventures and Winter Properties. Learn more at
www.standardindustries.com.
Additional Information and Where to Find It
This communication relates to the proposed transaction involving
W. R. Grace & Co. (“Grace” or the “Company”). In connection
with the proposed transaction, Grace will file relevant materials
with the U.S. Securities and Exchange Commission (the “SEC”),
including Grace’s proxy statement on Schedule 14A (the “Proxy
Statement”). This communication is not a substitute for the Proxy
Statement or any other document that Grace may file with the SEC or
send to its stockholders in connection with the proposed
transaction. BEFORE MAKING ANY VOTING DECISION, STOCKHOLDERS OF
GRACE ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH THE SEC,
INCLUDING THE PROXY STATEMENT, WHEN THEY BECOME AVAILABLE BECAUSE
THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED
TRANSACTION. Investors and security holders will be able to obtain
the documents (when available) free of charge at the SEC’s website,
http://www.sec.gov, and Grace’s website, www.grace.com. In
addition, the documents (when available) may be obtained free of
charge by accessing the Investor Relations section of Grace’s
website at investor.grace.com or by contacting Grace’s Investor
Relations by email at investor.relations@grace.com.
Participants in the Solicitation
The Company and its directors and executive officers may be
deemed to be participants in the solicitation of proxies from the
holders of Grace common stock in respect of the proposed
transaction. Information about the directors and executive officers
of Grace is set forth in the proxy statement for Grace’s 2020
annual meeting of stockholders, which was filed with the SEC on
March 31, 2020, and in other documents filed by Grace with the SEC.
Other information regarding the participants in the proxy
solicitation and a description of their direct and indirect
interests, by security holdings or otherwise, will be contained in
the Proxy Statement and other relevant materials to be filed with
the SEC in respect of the proposed transaction when they become
available.
Forward-Looking Statements
Certain statements contained in this communication may contain
forward-looking statements, that is, information related to future,
not past, events. Such statements generally include the words
“believes,” “plans,” “intends,” “targets,” “will,” “expects,”
“suggests,” “anticipates,” “outlook,” “continues,” or similar
expressions. Forward-looking statements include, without
limitation, statements regarding: financial positions; results of
operations; cash flows; financing plans; business strategy;
operating plans; capital and other expenditures; impact of COVID-19
on Grace’s business; competitive positions; growth opportunities
for existing products; benefits from new technology; benefits from
cost reduction initiatives; succession planning; markets for
securities; the anticipated timing of closing of the proposed
transaction and the potential benefits of the proposed transaction.
For these statements, Grace claims the protections of the safe
harbor for forward-looking statements contained in Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Grace is subject to
risks and uncertainties that could cause actual results or events
to differ materially from its projections or that could cause
forward-looking statements to prove incorrect. Factors that could
cause actual results or events to differ materially from those
contained in the forward-looking statements include, without
limitation: risks related to foreign operations, especially in
areas of active conflicts and in emerging regions; the costs and
availability of raw materials, energy, and transportation; the
effectiveness of Grace’s research and development and growth
investments; acquisitions and divestitures of assets and
businesses; developments affecting Grace’s outstanding
indebtedness; developments affecting Grace’s pension obligations;
legacy matters (including product, environmental, and other legacy
liabilities) relating to past activities of Grace; its legal and
environmental proceedings; environmental compliance costs
(including existing and potential laws and regulations pertaining
to climate change); the inability to establish or maintain certain
business relationships; the inability to hire or retain key
personnel; natural disasters such as storms and floods; fires and
force majeure events; the economics of our customers’ industries,
including the petroleum refining, petrochemicals, and plastics
industries, and shifting consumer preferences; public health and
safety concerns, including pandemics and quarantines; changes in
tax laws and regulations; international trade disputes, tariffs,
and sanctions; the potential effects of cyberattacks; the
occurrence of any event, change or other circumstance that could
give rise to the termination of the merger agreement between Grace
and Standard Industries Holdings Inc.’s affiliates; the failure to
obtain Grace stockholder approval of the transaction or the failure
to satisfy any of the other conditions to the completion of the
transaction; risks relating to the financing required to complete
the transaction; the effect of the announcement of the transaction
on the ability of Grace to retain and hire key personnel and
maintain relationships with its customers, vendors and others with
whom it does business, or on its operating results and businesses
generally; risks associated with the disruption of management’s
attention from ongoing business operations due to the transaction;
the ability to meet expectations regarding the timing and
completion of the transaction; significant transaction costs, fees,
expenses and charges; the risk of litigation and/or regulatory
actions related to the transaction; other business effects,
including the effects of industry, market, economic, political,
regulatory or world health conditions (including new or ongoing
effects of the COVID-19 pandemic), and other factors detailed in
Grace’s Annual Report on Form 10-K filed with the SEC for the
fiscal year ended December 31, 2020 and Grace’s other filings with
the SEC, which are available at http://www.sec.gov and on Grace’s
website at www.grace.com. Our reported results should not be
considered as an indication of our future performance. Readers are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date hereof. Grace
undertakes no obligation to release publicly any revisions to our
projections and forward-looking statements, or to update them to
reflect events or circumstances occurring after the dates those
projections and statements are made.
Grace Contacts:
Media Jamie Moser / Scott BisangJoele Frank,
Wilkinson Brimmer Katcher+1 212.355.4449
Investor Jason Hershiser+1
410.531.8835jason.hershiser@grace.com
Standard Industries Contacts:Lex
SuvantoEdelmanLex.Suvanto@edelman.com(646) 775-8337
Josh HochbergEdelmanJosh.Hochberg@edelman.com917 848-7194
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