Sector News

Axalta launches strategic review, sale of company possible

June 20, 2019
Chemical Value Chain

Axalta today said it is launching a review of strategic alternatives, including a potential sale of the company. Axalta shares jumped 13.6% after the news on 19 June, closing at $29.33.

The company has formed a strategic review committee chaired by independent presiding director Mark Garrett. The committee also includes Axalta CEO Robert Bryant and independent director Samuel Smolik.

“Axalta continues to execute on its long-term strategy, delivering significant cost savings to bolster our industry-leading margins, redeploying free cash flow to drive accretive organic and inorganic growth initiatives, and returning more than $380 million to shareholders over the last two years,” Bryant says.

Axalta’s largest shareholder is Berkshire Hathaway, with a 10.3% stake. Barclays and Evercore are acting as financial advisors to Axalta on the review, and Morrison & Foerster is acting as legal advisor.

The company is facing headwinds from soft automotive production, although pressure on margins seems likely to abate given a recent pullback in energy prices, says Laurence Alexander, an analyst with Jefferies (New York). “Axalta has discussed a sale of the company in the past, and our model pegs the company value at $38/share,” Alexander adds. “Over the past three years, bolt-on M&A and share repurchases have been the first use of cash.”

The timing and outcome are uncertain, and Axalta says it will not comment on the review until it is complete.

By Vincent Valk

Source: Chemical Week

comments closed

Related News

January 23, 2022

Eastman invests US$1B in world’s largest molecular plastics recycling facility in France

Chemical Value Chain

Eastman is investing up to US$1 billion in building what it says is the world’s largest molecular plastics recycling facility in France. The new facility would use Eastman’s polyester renewal technology to recycle up to 160,000 metric tons of hard-to-recycle plastic waste annually – enough plastic waste to fill Stade de France national football stadium 2.5 times.

January 23, 2022

LG Energy Solution opens books for South Korea’s largest IPO at up to $10.8 bln

Chemical Value Chain

Korean battery maker LG Energy Solution has opened the books to investors to raise up to $10.8 billion in the country’s largest initial public offering (IPO), according to a term sheet seen by Reuters. The shares will be sold in a price range of 257,000 won to 300,000 won ($216.19-$252.36) apiece to raise between $9.2 billion and $10.8 billion, the term sheet showed.

January 23, 2022

SHYNE, the largest consortium to promote renewable hydrogen in Spain, is born

Chemical Value Chain

The SHYNE (Spanish Hydrogen Network) project is the largest multisectoral consortium in Spain, created to promote the decarbonization of the economy through renewable hydrogen. SHYNE will have a total investment of €3.23 billion euros that will serve to develop more competitive technologies and evolve both the Spanish industry and its infrastructure towards decarbonization, generating more than 13,000 jobs.

Send this to a friend