Ferro is exploring strategic options including a potential sale, according to people familiar with the matter, reports Bloomberg.
The company is working with financial advisers, said the people, who asked not to be identified because the matter is not public, it reports. No final decision has been made and Ferro could opt to remain independent, the people said. A representative for Ferro did not respond to Bloomberg’s requests for comment.
Ferro is exploring a sale amid heavy consolidation among chemical companies with coatings operations, as tepid growth and volatile commodity prices spur industry players to pair up. Car-paint maker Axalta Coating Systems is exploring a sale while Celanese is undertaking a strategic review that could include a breakup, people familiar with those matters have said.
Ferro received a takeover approach in 2016 from Apollo Global Management after an activist investor in its stock said it should explore a sale, people familiar with the matter said at the time.
In its second-quarter financial results in July it reported net income of $10.9 million, a 64% year-on-year (YOY) decline on weak automotive and construction markets, while net sales fell 5.4% YOY to $393.9 million. The company cut its full-year earnings guidance to $225–240 million, citing trade-related uncertainty and higher manufacturing costs. Chairman and CEO Peter Thomas highlighted the effects of global economic uncertainty and slowing growth outside the US, and poor macroeconomic visibility leading to customer cautiousness in some of the company’s markets, “particularly the automotive and construction sectors.”
By Mark Thomas
Source: Chemical Week
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