Praxair to divest European gases business to allow merger clearance by European Commission
Praxair, Inc. and the Japanese industrial gases manufacturer Taiyo Nippon Sanso Corporation have entered into an agreement to sell the majority of Praxair’s European gases business. The business to be sold generated annual sales of approximately 1.3 billion EUR in 2017. The purchase price of 5 billion EUR will be subject to customary adjustments at closing.
Linde AG and Praxair consider a divestiture of such business to be necessary in order to allow merger clearance of the proposed business combination by the European Commission. This sale is still subject to the completion of the proposed business combination of Linde AG and Praxair, Inc. and regulatory approvals, including by the European Commission.
The receipt of regulatory approvals outstanding in other jurisdictions for the proposed business combination is expected to require that the merger partners will divest further businesses. Linde and Praxair are in discussions with the competent authorities and in negotiations with potential bidders with the objective of completing the business combination in the second half of 2018.
https://www.stahleisen.de/mpt-international/wp-content/uploads/sites/2/2016/07/MPT_International_Webicon-2.png300300redaktionhttps://www.stahleisen.de/mpt-international/wp-content/uploads/sites/2/2016/07/logo-mpt-international.pngredaktion2018-07-05 10:06:312018-07-05 10:06:31Praxair to divest European gases business to allow merger clearance by European Commission
Warehouse solutions provider 3tn adds crane automation software to its product portfolio
3tn, providers of the TWMS/metals warehouse management system, have taken over GIPA – Gesellschaft für Industrie- und Prozessautomation mbH. As from May 29, 2017, GIPA has been operating as a subsidiary of 3tn. With this transaction, the two companies have consolidated their long-standing partnership. Now they can offer efficient warehouse management solutions for the metals industry from a single source.
3tn and GIPA can look back on 18 years of successful cooperation. Numerous 3tn TWMS/metals projects in the steel industry implemented with crane automation systems from GIPA at any automation level testify to the long-standing partnership between the two companies.
On May 29, 3tn acquired all of the assets of GIPA mbH in order to further foster the successful relationship and be able in the future to offer innovative warehouse management systems complete with perfectly tailored automation solutions. GIPA will offer the same product and service portfolio as before and continue to serve customers separate from 3tn, for example as supplier of crane equipment for use in the environment of nuclear power generation.
Thorsten Tönjes and Thomas Niepmann, the founders and managing directors of 3tn, will also be managing directors of GIPA. They will be supported by Wolfgang Hagedorn, who will continue to act as GIPA managing director and provide his technological know-how in order to ensure maximum continuity of business.
3tn customers will benefit from the new situation in various ways: TWMS/metals systems and the underlying basic automation will be even better harmonized, resulting in smoother interfaces, easier coordination during the project phase and a shorter supply chain.
Thorsten Tönjes sees great potential for both companies: “For our joint customers, this means that hardware and software will come from the same source. With both companies operating under the same roof, it will be easier for us to offer innovative and cost-efficient solutions and to join forces to bring forward developments in the field of intralogistics in the metals industry.”
As in the past, the customers may choose between buying 3tn warehouse management systems complete with all associated automation or sourcing the automation systems from a third party.
https://www.stahleisen.de/mpt-international/wp-content/uploads/sites/2/2016/07/MPT_International_Webicon-2.png300300redaktionhttps://www.stahleisen.de/mpt-international/wp-content/uploads/sites/2/2016/07/logo-mpt-international.pngredaktion2017-06-21 09:32:402017-06-21 11:18:00Warehouse solutions provider 3tn adds crane automation software to its product portfolio
Quaker Chemical and Houghton International to combine
Creating a global leader uniquely positioned in metalworking and primary metals platforms with deep expertise across attractive customer segments
Quaker Chemical Corporation and Houghton International Inc., companies with a combined 250-year history as providers of process fluids, chemical specialties, and technical expertise to the global primary metals and metalworking industries, today announced that they have executed a definitive agreement to combine the companies. Both Quaker Chemical and Houghton International are headquartered in the Philadelphia area.
“The proposed combination of Quaker Chemical and Houghton International represents the next phase of our evolution, and stays true to the vision of growing in our core specialties,” said Michael F. Barry, Chairman and Chief Executive Officer of Quaker Chemical. “Joining forces with Houghton International combines two highly complementary businesses, each having a long history of building tremendous expertise, technology and customer-centric cultures dedicated to delivering long-term sustainable value to customers, shareholders and associates. The new company will capitalize on best practices and expertise from both businesses.”
Sanjay Hinduja, Chairman of Houghton International, which is owned by the Hinduja Group through its Gulf Oil business, said, “We are pleased to enter this agreement to unite these two distinguished and global companies. Together we will strengthen our capabilities and business models to better serve the global market and all our stakeholders.”
Under the terms of the agreement, Houghton International shareholders will receive $172.5 million of cash and 24.5 percent ownership of the combined company, representing approximately 4.3 million shares of newly issued Quaker Chemical stock. In addition, Quaker Chemical will assume Houghton International’s debt and cash, with net debt of approximately $690 million at year-end 2016. The agreement has been approved by both Quaker Chemical’s board of directors and Houghton International’s board of directors with full support of the Hinduja Group, which will become Quaker Chemical’s largest shareholder.
Houghton International and Quaker Chemical are both known for a commitment to innovation in a highly specialized and technologically demanding industry.
“In addition to our complementary businesses,” said Mike Shannon, Chief Executive Officer of Houghton International, “we are each committed to creating solutions for our customers through innovation, strong technical expertise and global reach with localized applications expertise.”
Highly complementary transaction
Combining Quaker Chemical’s and Houghton International’s product solutions and service offerings will allow the new company to better serve customers in the automotive, aerospace, heavy equipment, metals, mining, machinery, marine, offshore, and container industries. The business will have one of the world’s most expansive metalworking platforms comprised of specialty products that include removal fluids, forming fluids, protecting fluids, heat treating fluids, industrial lubricants and greases.
The expanded portfolio is expected to generate significant cross-selling opportunities and allow further expansion into growth markets that include India, Korea, Japan, and Mexico.
By combining resources, the new company will increase the breadth of its innovative technology, accelerate its product development initiatives and time to market, and diversify its long-term R&D pipeline.
The company’s customer-intimate business model will be further strengthened with an expanded chemical management offering. The enhanced portfolio, industry-expert associates and applications expertise will enable the combined company to bring additional value to its customers’ overall performance and operations.
Value creation for shareholders
For 2016, Quaker Chemical had revenue of $747 million, $107 million of adjusted EBITDA, and $22 million of net cash. During the same period, Houghton International had revenue of $767 million, $120 million of adjusted EBITDA, and $690 million of net debt. After the close of the transaction, shares of the combined company will continue to be listed on the New York Stock Exchange.
The company anticipates achieving cost synergies of approximately $45 million, the majority of which will be realized within two years of closing. These synergies are expected to be driven primarily by supply efficiencies and cost reductions. Additional value creation is expected through cross-selling opportunities and the ability to provide an expanded array of products and solutions for customers.
Post-transaction, the combined company expects to continue to maintain its dividend and use its strong cash flow generation to quickly reduce debt, improving its pro forma net debt to adjusted EBITDA ratio from approximately 3.7 times at close to approximately 2.5 times within two years after close.
Financing, governance and leadership
Quaker Chemical has secured $1.15 billion in committed financing from Bank of America Merrill Lynch and Deutsche Bank Securities Inc. to support the transaction, which includes $200 million of additional liquidity for future needs. The company estimates that the annual ongoing interest costs of the financing will be in the 3 percent range at today’s interest rates.
The completion of the transaction, which is expected by the end of 2017 or early 2018, is subject to customary closing conditions, including regulatory approvals and approval by Quaker Chemical shareholders. The companies will continue to operate independently until the transaction is completed.
Following closing of the transaction, the new company is expected to have a 12-member board of directors, consisting of 9 directors from Quaker Chemical and 3 directors to be nominated by the Hinduja Group. Michael F. Barry will continue as Chairman and Chief Executive Officer of the new business, and the structure of the company will be determined in the period between signing and closing.
Deutsche Bank Securities Inc. is serving as Quaker Chemical’s lead financial advisor. Drinker Biddle & Reath LLP are acting as its legal advisors. The Valence Group provided a fairness opinion to the Board of Directors.
RBC Capital Markets, LLC is serving as exclusive financial advisor to Houghton International. Mayer Brown LLP are acting as its legal advisors.
About Quaker Chemical
Quaker Chemical is a leading global provider of process fluids, chemical specialties, and technical expertise to a wide range of industries, including steel, aluminum, automotive, mining, aerospace, tube and pipe, cans, and others. For nearly 100 years, Quaker Chemical has helped customers around the world achieve production efficiency, improve product quality, and lower costs through a combination of innovative technology, process knowledge, and customized services. Headquartered in Conshohocken, Pennsylvania, USA, Quaker Chemical serves businesses worldwide with a network of dedicated and experienced professionals whose mission is to make a difference.
About Houghton International
Houghton International is a global leader in delivering advanced metalworking fluids and services for the automotive, aerospace, metals, mining, machinery, offshore and beverage industries. Headquartered in Valley Forge, Pennsylvania, Houghton International operates research, manufacturing and office locations in 33 countries around the world delivering solutions that increase productivity, reduce operating costs and improve product quality for our customers. Houghton International is a Hinduja Group Company, which has owned more than 95% of Houghton International since 2012.
About Hinduja Group
The Hinduja Group is one of India’s premier diversified and transnational conglomerate. Employing nearly 100,000 employees, with presence across 38 countries, it has multi-billion-dollar revenue. The Group was founded over a hundred years ago by Shri P.D. Hinduja whose credo was “My duty is to work so that I can give.”
The Group owns businesses in Automotive, Information Technology, Media, Entertainment & Communications, Banking & Finance Services, Infrastructure Project Development, Oil and Gas, Power, Real Estate, Trading and Healthcare. It also supports charitable and philanthropic activities across the world through the Hinduja Foundation.
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