Trinseo has agreed to sell its synthetic rubber business to the Polish company Synthos for $491m, the US-based styrenics producer said on Friday.
Out of the total, $449.4m is made up of cash and $41.6m represents pension liabilities, Trinseo said. It expects net cash proceeds will be $400m after factoring the costs and taxes associated with the sale.
The deal should close in 2022. It will include Trinseo’s plant in Schkopau, Germany, as well as the related research-and-development facilities.
The segment makes solution styrene butadiene rubber (SSBR) and emulsion styrene butadiene rubber (ESBR). It also makes nickel polybutadiene rubber (Ni-PBR) and neodynium PBR (Nd-PBR).
Synthos did not immediately respond to a request for comment after hours in Poland.
Trinseo’s CEO, Frank Bozich, said the sale will strengthen the company’s balance sheet.
Earlier this year, Trinseo closed on the €1.14bn acquisition of Arkema’s polymethyl methacrylate (PMMA) business.
Trinseo is funding the acquisition with up to $250m of existing cash. The rest will come from new debt financing.
The sale of the synthetic rubber business will also give Trinseo more flexibility to acquire more businesses and develop organic growth projects, Bozich said.
During a conference call, Trinseo said it wants to build a PMMA plant and a compounding line in Asia Pacific.
“In pursuing our transformation strategy toward becoming a higher margin and less cyclical specialty materials and sustainable solutions provider, we believe our best path is to focus on growth in engineered materials and CASE applications,” he said.
CASE refers to coatings, adhesives, sealants and elastomers.
By Al Greenwood
Source: icis.com
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