February 8 2019, David R Brown
Univar and Nexeo Solutions to divest Nexeo's plastics distribution business to One Rock Capital Partners
Global chemical and ingredient distributor, Univar Inc. (NYSE: UNVR) ('Univar') and Nexeo Solutions, Inc. (NASDAQ: NXEO) ('Nexeo Solutions') have announced an agreement for Nexeo Solutions to divest its plastics distribution business ('Nexeo Plastics') to an affiliate of One Rock Capital Partners, LLC for an enterprise value of USD 640 million, subject to customary closing adjustments.
Today's announcement marks the conclusion of our strategic review for Nexeo's Plastics Business and enables us to concentrate our energy on the core chemical distribution businessDavid Jukes
President and CEO of Univar
Univar's president and CEO, David Jukes, said: “Today's announcement marks the conclusion of our strategic review for Nexeo's Plastics Business and enables us to concentrate our energy on the core chemical distribution business and the abundant value creation opportunities from the Nexeo Solutions and Univar combination.”
Nexeo Solutions' president and CEO, David Bradley, commented: “For One Rock, the purchase of Nexeo Solutions Plastics represents an opportunity to acquire an industry-leading plastics distributor with strong customer and supplier relationships. As a stand-alone business with a clear strategy, the outlook for the Plastics business and its employees is extraordinary.”
“We are very excited to have One Rock invest in our business, which Nexeo Solutions has built into one of the leading global plastics distribution companies,” said Shawn Williams, executive vice president, for Plastics at Nexeo Solutions. “We look forward to operating as a pure-play plastics business and will focus our talent and resources on expanding our service offering for our suppliers and customers worldwide.”
One Rock Managing Partner Tony Lee commented, “We are excited about the opportunity to create a standalone plastics distribution business and invest in growth by deepening its relationships with customers and supplier partners. We look forward to collaborating with Nexeo Plastics' management team to achieve the full potential of the business.”
The divestiture is expected to result in net cash proceeds of at least USD 615 million, which will be immediately utilized to pay down debt in the combined Nexeo/Univar business. Transition services for corporate functions and shared distribution sites will be provided in order to support the buyer and seller during the transition period.
The divestiture has been approved by the Boards of Directors of both Univar and Nexeo Solutions and is anticipated to close in the first half of 2019, subject to receipt of regulatory approvals and satisfaction of other customary conditions and the closing of, or the satisfaction of the conditions to the closing of, Univar's acquisition of Nexeo Solutions.
Founded in 1924, Univar is a global chemical and ingredient distributor and provider of value-added services, working with leading suppliers worldwide. Supported by a comprehensive team of sales and technical professionals with deep specialty and market expertise, Univar operates hundreds of distribution facilities throughout North America, Western Europe, Asia-Pacific and Latin America. In 2017, Univar reported revenues of USD 8.25 million and had nearly 9,000 employees located in 31 countries.
Source(s): Univar Press Release