Mergers & Acquisitions
October 12, 2021
Arsenal Makes Another Acquisition
Arsenal’s Applied Adhesives Acquires American Chemical MINNETONKA, Minn., October 12, 2021 — APPLIED Adhesives, a premier custom adhesive solutions provider in North America, today announced the acquisition of American Chemical, a regional supplier of adhesives and sealants located in Minneapolis, MN. APPLIED’s acquisition of American Chemical serves to strengthen its commitment of providing industry leading technical expertise and exceptional service to its customers.
“American Chemical has consistently delivered innovative solutions and exceptional value to its customers, which aligns with our culture of relentless customer focus,” said John Feriancek, president and chief executive officer of APPLIED Adhesives. “We look forward to welcoming American Chemical’s customers to the APPLIED family and providing them outstanding service, support, and value.”
For over 30 years, American Chemical has supported the needs of its customers through new product development and in-house lab services for unique applications. “I am very proud of American Chemical’s legacy of innovation and customer support,” said Dennis Werneke, former owner of American Chemical. “I’m excited that our customers will now have the opportunity to partner with APPLIED and their talented, customer-focused team of professionals. Our customers are in good hands.”
American Chemical is APPLIED Adhesives’ third acquisition in 2021 and its eighth in the last four years.
Financing & Advisors Krahn Capital Group, LLC advised American Chemical in the transaction.
About APPLIED Adhesives APPLIED Adhesives, founded in 1971, is a premier custom adhesive solutions provider for the packaging, paper converting, graphic arts, bottle labeling, product assembly, and automotive industries. The company is a value-added distributor of hot melt, water-based, and reactive adhesives as well as dispensing equipment. APPLIED Adhesives serves as a critical supply chain partner to leading adhesive manufacturers and formulators by offering reach and high service levels to an expansive customer base. For more information, please visit appliedadhesives.com.
About Krahn Capital Group, LLC Krahn Capital Group is a boutique investment banking firm specializing in mergers and acquisitions and capital advisory services for privately held businesses in the lower middle market. For more information, please visit www.krahncapitalgroup.com.
About Arsenal Capital Partners Arsenal is a leading private equity firm that specializes in investments in middle-market industrial growth and healthcare companies. Since its inception in 2000, Arsenal has raised institutional equity investment funds of $5.3 billion, has completed more than 200 platform and add-on investments, and achieved more than 30 realizations. Arsenal invests in industry sectors in which the firm has significant prior knowledge and experience. The firm works with management teams to build strategically important companies with leading market positions, high growth, and high value-add. Visit www.arsenalcapital.com.
October 12, 2021
Arsenal Makes Another Acquisition
Arsenal’s Applied Adhesives Acquires American Chemical MINNETONKA, Minn., October 12, 2021 — APPLIED Adhesives, a premier custom adhesive solutions provider in North America, today announced the acquisition of American Chemical, a regional supplier of adhesives and sealants located in Minneapolis, MN. APPLIED’s acquisition of American Chemical serves to strengthen its commitment of providing industry leading technical expertise and exceptional service to its customers.
“American Chemical has consistently delivered innovative solutions and exceptional value to its customers, which aligns with our culture of relentless customer focus,” said John Feriancek, president and chief executive officer of APPLIED Adhesives. “We look forward to welcoming American Chemical’s customers to the APPLIED family and providing them outstanding service, support, and value.”
For over 30 years, American Chemical has supported the needs of its customers through new product development and in-house lab services for unique applications. “I am very proud of American Chemical’s legacy of innovation and customer support,” said Dennis Werneke, former owner of American Chemical. “I’m excited that our customers will now have the opportunity to partner with APPLIED and their talented, customer-focused team of professionals. Our customers are in good hands.”
American Chemical is APPLIED Adhesives’ third acquisition in 2021 and its eighth in the last four years.
Financing & Advisors Krahn Capital Group, LLC advised American Chemical in the transaction.
About APPLIED Adhesives APPLIED Adhesives, founded in 1971, is a premier custom adhesive solutions provider for the packaging, paper converting, graphic arts, bottle labeling, product assembly, and automotive industries. The company is a value-added distributor of hot melt, water-based, and reactive adhesives as well as dispensing equipment. APPLIED Adhesives serves as a critical supply chain partner to leading adhesive manufacturers and formulators by offering reach and high service levels to an expansive customer base. For more information, please visit appliedadhesives.com.
About Krahn Capital Group, LLC Krahn Capital Group is a boutique investment banking firm specializing in mergers and acquisitions and capital advisory services for privately held businesses in the lower middle market. For more information, please visit www.krahncapitalgroup.com.
About Arsenal Capital Partners Arsenal is a leading private equity firm that specializes in investments in middle-market industrial growth and healthcare companies. Since its inception in 2000, Arsenal has raised institutional equity investment funds of $5.3 billion, has completed more than 200 platform and add-on investments, and achieved more than 30 realizations. Arsenal invests in industry sectors in which the firm has significant prior knowledge and experience. The firm works with management teams to build strategically important companies with leading market positions, high growth, and high value-add. Visit www.arsenalcapital.com.
October 11, 2021
Carpenter to Acquire Recticel’s Engineered Foams Unit
Recticel announces strategy update and the intended sale of its Engineered Foams business
Occasional information, Brussels, 11/10/2021 — 13:15 CET, 11.10.2021
Strategy update
- Group to focus exclusively on its Insulation business segment, presenting excellent growth and profitability prospects going forward
- Consequent sale of Recticel’s Engineered Foams business segment, demonstrating far superior value creation versus the unsolicited offer by Greiner
Transaction highlights
- Binding offer received from US-based Carpenter Co., one of the world’s largest producer of foam and specialty products
- Cash consideration based on an enterprise value of EUR 656 million on a cash and debt free basis (representing about €11.65 per Recticel share on a fully diluted basis)
- Strong strategic fit with global footprint, complementary product offering and vertical integration
- Transaction subject to shareholder approval and to customary conditions including regulatory approval and confirmatory due diligence
Strategy update
Following the unsolicited offer by Greiner in May 2021, Recticel’s Board of Directors concluded that the offer was not in the interest of shareholders and other stakeholders, and significantly undervalued the company.
Subsequently, Recticel’s Board of Directors initiated a complete review of its strategic alternatives taking into account the interest of all stakeholders. After due consideration of these alternatives, the Board of Directors came to the conclusion that a better strategic project and superior value can be created by pursuing a strategy to separate its businesses and to dispose Engineered Foams.
Transaction overview
In consequence, Recticel N.V. today announces it has received a binding offer from Carpenter Co. for its Engineered Foams business for a cash consideration based on an Enterprise Value of EUR 656 million on a cash and debt free basis. The Board of Directors will review options for the use of proceeds from the sale of the Engineered Foams business, including the potential distribution to shareholders, taking into account the interests of all stakeholders.
Carpenter Co., headquartered in the US (Richmond, Virginia), is one of the world’s largest producers of foam products with more than 4,000 employees and over 50 locations in North America and Europe. Founded in 1948 and privately owned since, Carpenter is active in the US, Canada, the UK, Belgium, France, Germany, Sweden and Denmark. Carpenter achieves approximately USD 2 billion (or approx. EUR 1.7 billion) in annual sales.
Combining Recticel’s Engineered Foams business with Carpenter’s Foams business will create the world’s largest vertically integrated manufacturer of polyurethane foams and specialty polymer products. Recticel’s Engineered Foams business will considerably strengthen Carpenter’s European division, while complementing its North America division and providing a foothold in Asia.
Olivier Chapelle (CEO of Recticel): “Combining our Engineered Foams business with Carpenter creates enhanced growth opportunities for our Engineered Foams business, which will in addition benefit from the vertical integration of Carpenter. We believe that Carpenter Co. will be a great new owner for our Engineered Foams employees and business, with strong strategic fit through highly complementary footprint and product offerings, together with a clear focus on both people and customers.
In addition, together with the intended sale of our Bedding division, we believe that we will be able to unlock the full value potential of Recticel and create superior value for our shareholders versus the unsolicited bid of Greiner.”
Brad Beauchamp (CEO of Carpenter Co.): “We are very excited about today’s announcement. The intended acquisition of Recticel’s Engineered Foams Business will strengthen our position in the technical foam markets in North America and in Europe through a more diverse and complementary product offering, while establishing a presence in Asia Pacific. It will also accelerate the expansion of our offerings into new markets. We are confident in our ability to execute and complete the transaction and obtain all necessary approvals within the shortest possible timeframe and look forward to join forces with Recticel’s Foams business to deliver enhanced value for our customers and shareholders.”
Next steps
The intended sale of the Engineered Foams business is subject to shareholder approval and to certain customary conditions, including regulatory approvals and confirmatory due diligence. The regulatory approvals relate amongst other to anti-trust clearances. The confirmatory due diligence will be completed before the Extraordinary General Meeting. This Extraordinary General Meeting of shareholders, which is mandatory in accordance with art. 7:152 of the Belgian Companies Code in the context of the current take-over bid, will be planned for early December 2021. The closing of the transaction is expected to take place the second quarter of 2022.
Recticel expects to make further announcements in due course.
October 11, 2021
Carpenter to Acquire Recticel’s Engineered Foams Unit
Recticel announces strategy update and the intended sale of its Engineered Foams business
Occasional information, Brussels, 11/10/2021 — 13:15 CET, 11.10.2021
Strategy update
- Group to focus exclusively on its Insulation business segment, presenting excellent growth and profitability prospects going forward
- Consequent sale of Recticel’s Engineered Foams business segment, demonstrating far superior value creation versus the unsolicited offer by Greiner
Transaction highlights
- Binding offer received from US-based Carpenter Co., one of the world’s largest producer of foam and specialty products
- Cash consideration based on an enterprise value of EUR 656 million on a cash and debt free basis (representing about €11.65 per Recticel share on a fully diluted basis)
- Strong strategic fit with global footprint, complementary product offering and vertical integration
- Transaction subject to shareholder approval and to customary conditions including regulatory approval and confirmatory due diligence
Strategy update
Following the unsolicited offer by Greiner in May 2021, Recticel’s Board of Directors concluded that the offer was not in the interest of shareholders and other stakeholders, and significantly undervalued the company.
Subsequently, Recticel’s Board of Directors initiated a complete review of its strategic alternatives taking into account the interest of all stakeholders. After due consideration of these alternatives, the Board of Directors came to the conclusion that a better strategic project and superior value can be created by pursuing a strategy to separate its businesses and to dispose Engineered Foams.
Transaction overview
In consequence, Recticel N.V. today announces it has received a binding offer from Carpenter Co. for its Engineered Foams business for a cash consideration based on an Enterprise Value of EUR 656 million on a cash and debt free basis. The Board of Directors will review options for the use of proceeds from the sale of the Engineered Foams business, including the potential distribution to shareholders, taking into account the interests of all stakeholders.
Carpenter Co., headquartered in the US (Richmond, Virginia), is one of the world’s largest producers of foam products with more than 4,000 employees and over 50 locations in North America and Europe. Founded in 1948 and privately owned since, Carpenter is active in the US, Canada, the UK, Belgium, France, Germany, Sweden and Denmark. Carpenter achieves approximately USD 2 billion (or approx. EUR 1.7 billion) in annual sales.
Combining Recticel’s Engineered Foams business with Carpenter’s Foams business will create the world’s largest vertically integrated manufacturer of polyurethane foams and specialty polymer products. Recticel’s Engineered Foams business will considerably strengthen Carpenter’s European division, while complementing its North America division and providing a foothold in Asia.
Olivier Chapelle (CEO of Recticel): “Combining our Engineered Foams business with Carpenter creates enhanced growth opportunities for our Engineered Foams business, which will in addition benefit from the vertical integration of Carpenter. We believe that Carpenter Co. will be a great new owner for our Engineered Foams employees and business, with strong strategic fit through highly complementary footprint and product offerings, together with a clear focus on both people and customers.
In addition, together with the intended sale of our Bedding division, we believe that we will be able to unlock the full value potential of Recticel and create superior value for our shareholders versus the unsolicited bid of Greiner.”
Brad Beauchamp (CEO of Carpenter Co.): “We are very excited about today’s announcement. The intended acquisition of Recticel’s Engineered Foams Business will strengthen our position in the technical foam markets in North America and in Europe through a more diverse and complementary product offering, while establishing a presence in Asia Pacific. It will also accelerate the expansion of our offerings into new markets. We are confident in our ability to execute and complete the transaction and obtain all necessary approvals within the shortest possible timeframe and look forward to join forces with Recticel’s Foams business to deliver enhanced value for our customers and shareholders.”
Next steps
The intended sale of the Engineered Foams business is subject to shareholder approval and to certain customary conditions, including regulatory approvals and confirmatory due diligence. The regulatory approvals relate amongst other to anti-trust clearances. The confirmatory due diligence will be completed before the Extraordinary General Meeting. This Extraordinary General Meeting of shareholders, which is mandatory in accordance with art. 7:152 of the Belgian Companies Code in the context of the current take-over bid, will be planned for early December 2021. The closing of the transaction is expected to take place the second quarter of 2022.
Recticel expects to make further announcements in due course.
October 8, 2021
MCNS to Dissolve
Mitsui / SKC: PU raw materials joint venture to be terminated
On 30 September 2021, Mitsui Chemicals, Inc. and SKC Co., Ltd. announced plans to dissolve their joint venture agreement for Mitsui Chemicals & SKC Polyurethanes Inc. (MCN), a subsidiary that combines the two parent companies’ operations in polyurethane raw materials.
The two companies established MCNS in July 2015 as a joint venture for their operations in polyurethane raw materials. The partners said they have since endeavoured to maximise synergy in their joint operations here in an effort to capture demand in growth markets, roll out new operations across the globe and improve profitability.
According to the companies, discrepancies have started to arise between Mitsui Chemicals’ policy of steadily improving earnings through the likes of high-performance products and bio-products and SKC’s policy of quickly expanding global market in scale. This has then prompted both companies to take another thorough look at how they should be running their operations in this field. The parties have determined that it would be beneficial for each company to run its own operations in line with its specific strategy, if both companies are to further grow their businesses.
The dissolution is scheduled to occur at the end of December 2021. On 1 January 2022, operations of the Japanese entity MCNS-J will re-launch as the Polyurethane Division, Basic Materials Business Sector, of Mitsui Chemicals. In March 2022, Mitsui will transfer shares in the South Korean entity MCNS to reduce paid-in capital, and the liquidation of MCNS-J will be completed.
Going forward, customers will continue to receive their stable supply of products from either Mitsui or SKC.
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