Two multibillion dollar deals set the pace for plastics materials mergers and acquisitions in the first half of 2022.
In a major engineering resins deal, Celanese Corp. of Dallas acquired a majority of DuPont Co.'s Mobility & Materials unit for $11 billion in cash. The businesses being acquired have annual sales of about $3.5 billion. Officials with DuPont in Wilmington, Del., said that the sale price represents an enterprise value multiple of around 14 times the unit's 2021 operating EBITDA.
The deal includes a major nylon resin business but doesn't include DuPont's Tedlar fluoropolymer, Multibase silicone additives or Delrin acetal businesses. Celanese is the world's largest acetal maker.
The acquisition "is an important strategic step forward and establishes Celanese as the preeminent global specialty materials company," Celanese Chairman and CEO Lori Ryerkerk said.
Tom Kelly, Celanese EM senior vice president, added that the DuPont business "is a uniquely complementary specialty materials asset to EM, spanning product, geography and end-market."
The deal includes 29 global manufacturing sites and an intellectual property portfolio of about 850 patents. The business being acquired employs around 5,000 in manufacturing, technical and commercial roles.
Brands and materials involved in the sale include Zytel nylon, Crastin polybutylene terephthalate (PBT), Rynite high-performance nylon and filaments and Vamac and Hytrel elastomers. Nylon is a major part of DuPont's history. The firm began commercial production of nylon 6/6 fiber in 1939 at a newly built plant in Seaford, Del., about 90 miles from company headquarters in Wilmington.
In another major deal, Lanxess AG and global private equity firm Advent International joined forces to acquire Royal DSM NV's engineering materials business for almost $4 billion. The business being acquired has annual sales of about $1.6 billion.
Officials with Lanxess in Cologne, Germany, said the business is one of the leading global suppliers in high-performance specialty materials that address key market needs in electronics, electrical and consumer goods. Lanxess will contribute its own High-Performance Materials unit to the joint venture. HPM is a leading supplier of high-performance polymers, primarily to the automotive sector. That business has annual sales of around $1.6 billion.
Advent will hold at least 60 percent in the joint venture. Lanxess will receive an initial payment of at least $1.2 billion and a stake of up to 40 percent. Lanxess also has the option to divest its stake in the joint venture to Advent at the same valuation after three years. Lanxess CEO Matthias Zachert said that with the joint venture, his firm "will once again become significantly less dependent on economic fluctuations."
The DSM unit makes nylon, PET, PBT, copolyester and other materials. It employs 2,100 worldwide at eight production sites and seven R&D centers. Lanxess is a maker of specialty chemicals and plastics that employs 14,900 and posted sales of almost $7 billion in 2020.
The JV will include DSM sites in The Netherlands, China, India Belgium, Taiwan and Evansville, Ind. Lanxess sites included in the JV are in Germany, China, Belgium, India, Brazil; and Gastonia, N.C.
Boston-based Advent has $88 billion in assets under management. Its holdings include German acrylic resin maker Röhm GmbH.