The Urethane Blog
June 13, 2023
Korea’s SKC in talks to sell polyol subsidiary SK pucore to private equity firm
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| [Courtesy of SKC] |
SKC Corp., a South Korean polyethylene terephthalate (PET) film manufacturer, will sell its polyol subsidiary SK pucore Co. to a private equity firm in a move to liquidate assets to focus on chips and secondary battery materials business.
According to multiple sources from the investment bank industry on Monday, SKC is currently in talks to sell SK pycore to Glenwood Private Equity for about 500 billion won ($390 million).
The two companies recently signed a memorandum of understanding and are expected to sign a contract soon after conducting due diligence.
Samil PricewaterhouseCoopers is known to lead the sales as financial adviser of the buyer.
The deal is expected to be valued at about 10 times the last year‘s earnings before interest, taxes, depreciation, and amortization (EBITDA), which stood at 48.8 billion won.
SK pucore, formerly MCNS, which was jointly established by SKC and Japan’s Mitsui Chemicals Inc. in 2015, produces polyols, a raw material for polyurethane.
The partnership with Mitsui Chemicals ended in 2021 and the company changed its name. SK pucore has a dominant position in the domestic polyol market. Last year, it accounted for 40 percent of the entire market.
The sale comes as SKC is hoping to stack cash for investments and improve financial health.
SKC announced to invest 1.8 trillion won to strengthen its semiconductor and secondary battery materials business capacity. SKC is also in the process of acquiring semiconductor testing company ISC Co. for about 400 billion won.
SKC’s net debt to EBITDA was more than 6 times in the first quarter of this year, up from 3.5 times in 2021. The company’s net debt stood at 3.6 trillion won as of the first quarter.
Glenwood PE is a mid-sized private equity fund manager in Korea. It recently acquired the diagnostics division of LG Chem Ltd. and is the second-largest shareholder of Hanwha Advanced Materials Corp. and CJ Olive Young Corp.
Glenwood PE, in particular, manages PI Advanced Materials Co., which it previously acquired from SKC. The latest deal is expected to create synergy.
Polyurethanes manufactured through SK pucore’s flagship product, polyols, are utilized in a wide range of downstream industries, including automotive, fashion, electronics, and medical devices.
The company has more than 450 customers, more than 130 distribution partners, and production facilities in five countries. Last year, SK pucore raised 32.4 billion won in operating profit on sales of 720.6 billion won.
The company has secured future growth engines recently by developing eco-friendly polyol products. Customers return waste polyols to SK pucore, and the company makes recycled polyols from them and supplies them back to customers. The company is also accelerating the production of bio-polyols based on vegetable oils.
The investment bank industry is observing whether SKC will continue to secure more assets to build a portfolio that centers on new businesses.
“This year, we plan to strengthen the competitiveness of our core businesses by expanding global expansion and sales of copper foil and increasing the proportion of high-value-added products in our semiconductor and chemical businesses,” said SKC Chief Executive Officer Park Won-cheol in March.
“We will expand new growth businesses through active additional mergers and acquisitions.”
The company also sold its film division to private equity firm Hahn & Company for 1.6 trillion won last year.
Some critics, however, raise concerns about the sales being carried out by SKC as the M&A market is still unstable.
“We are concerned that the company is selling assets in a rush when the buyer has more power,” said an industry insider. “The company is desperate to secure liquidity but it should also be considered that it may send an excessive signal to the market that SKC’s financial situation is unstable.”
June 7, 2023
Mike Rowe Is On A Mission To Reverse The “Unspeakable Stupidity” Of Devaluing Work
by Tyler Durden
Wednesday, Jun 07, 2023 – 05:00 PM
Authored by Salena Zito via American Greatness,
A few months ago, Mike Rowe stumbled upon a 2011 video of himself speaking in front of the Senate Commerce, Science, and Transportation Committee during the Obama Administration about the mindset of government toward skilled trades. His argument was that skilled trades were the key to saving our economy, not those jobs that require a four-year degree.
His argument fell on deaf ears.
So he went again in April 2014, this time testifying before the House Committee on Natural Resources to discuss the opportunities for skilled trade workers in the energy industry. This time he brought props, specifically the poster his guidance counselor from high school pointed to when he tried to bully Rowe into picking a high-priced university over a community college his senior year.
Rowe said he had nothing against college, but the universities his counselor recommended were expensive. “I had no idea what I wanted to study. I thought a community college made more sense, but Mr. Dunbar said a two-year school was ‘beneath my potential,’” explained Rowe.
“Mr. Dunbar pointed to a poster hanging behind his desk; on one side of the poster was a beaten-down, depressed-looking blue-collar worker. On the other side was an optimistic college graduate with his eyes on the horizon. Underneath them, the text read: Work Smart NOT Hard,” Rowe told the committee.
“Mike, look at these two guys,” Mr. Dunbar said. “Which one do you want to be?”
“I had to read the caption twice. Work Smart NOT Hard?” Rowe recounted.
The visual was jarring, not to mention insulting, yet once again, nothing happened.
Rowe made his final plea to Congress in March 2017 when he once again schlepped to Capitol Hill, this time for the House Subcommittee on Early Childhood, Elementary, and Secondary Education. He discussed how career and technical education (CTE) can help close the skills gap and empower students to succeed, and he stressed the need to reform the current law.
His message was simple: CTE, and skilled trade professions, need a public relations makeover and a champion. “If you want to make America great again, you’ve got to make work cool again,” he said.
“So, my point to Congress was we just have to get people to think differently about the definition of a good job. And we need to put better examples of real people out there who are prospering as the result of learning a trade,” he said.
“We just shot seven or eight PSAs a couple months ago with people who we helped through the trade scholarship fund at the foundation. HVAC workers, plumbers, welders, all making six figures, and I am going to put these PSAs out there in the same spirit of those ads that made people think differently about conservation, and we are going to make people think differently about work,” he said.
The spots are pitch perfect. The first one with Chloe Hudson begins with Rowe dispelling the notion that you cannot make six figures working with your hands. It then cuts to Hudson, a welder who received a work ethic scholarship from mikeroweWORKS and went on to earn six figures a year, talking about the beauty of her life.
“I’m going to raise whatever I have to, I’m going to spend whatever I have to get these examples front and center. So that’s what I’ve got. In a way, it’s nothing new. In another way, it’s me finally saying, ‘Look, this was a good idea 10 years ago, and why not me?’ I’ll do it. I’m going to do it,” Rowe says with his characteristic charm that has endeared him to millions for more than 20 years.
Rowe said people really need to acknowledge the “unspeakable stupidity” of taking shop classes out of high schools 40 years ago. “The unintended consequences of that alone have been unraveling in ways that’s just mind-boggling. We effectively removed from view an entire category of vocations,” he said.
“In the long history of stupidity, you’d have to go a long way to find something dumber than universally removing shop class from high school. But of course, at the same time we did that, we started telling that same generation of kids that the best path for the most people was the most expensive path,” he said of the idea that higher education is the only path to success.
Which brings Rowe to wonder: Were they intentionally telling students who went into trades that they were achieving lower education?
It should make us wonder as well: Who did these decision-makers think was going to take care of their plumbing, fix their car, install their air conditioning, repair their furnace or rewire their house?
Rowe said he knows he is not going to open the eyes of the varsity blues crowd. “I can’t. They’re not persuadable. But there are a lot of people in the middle, a lot of people that just want to feel better about the possibility of exploring a career. So that’s what I’m going to do. I’m going to take my own advice. I’m going to stop telling Congress what to do, and I’m going to do it myself,” he said.
https://www.zerohedge.com/political/mike-rowe-mission-reverse-unspeakable-stupidity-devaluing-work
June 7, 2023
US mattress maker Serta Simmons receives Chapter 11 plan approval
Story by Reuters • Yesterday 10:57 PM
June 6 (Reuters) – Mattress maker Serta Simmons Bedding on Tuesday said that its Chapter 11 reorganization plan has been confirmed by a U.S. bankruptcy court, bringing the bedding company one step closer to emerging from bankruptcy.
The Doraville, Georgia-based company, whose roots date to 1870, filed for Chapter 11 protection from creditors in January with the U.S. Bankruptcy Court in the Southern District of Texas, in a bid to eliminate most of its debt.
The mattress manufacturer, which accounts for nearly one-fifth of U.S. bedding sales and whose brands include Serta, Simmons, Beautyrest, and Tuft & Needle, said it is operating normally as usual.
Serta Simmons, backed by Apollo Global Management and Gamut Capital Management through its restructuring plan aims to reduce its debt to $315 million from $1.9 billion, in addition to which it projects that the company’s annual cash interest expense will fall by more than $100 million.
The company during the COVID-19 pandemic had added $200 million of new capital to weather higher raw material costs and supply chain disruptions.
However, significant amounts of debt maturing in 2023 have made the company’s capital structure unsustainable, necessitating a comprehensive restructuring that is now supported by more than three-quarters of its key lenders. (Reporting by Mrinmay Dey in Bengaluru; Editing by Sonia Cheema)
June 7, 2023
Univar Solutions Stockholders Approve Acquisition by Apollo Funds
News provided by Univar Solutions Inc.
06 Jun, 2023, 16:15 ET
DOWNERS GROVE, Ill., June 6, 2023 /PRNewswire/ — Univar Solutions Inc. (NYSE: UNVR) (“Univar Solutions” or the “Company”), a leading global solutions provider to users of specialty ingredients and chemicals, announced today that its stockholders have voted at a special meeting of Univar Solutions stockholders (the “Special Meeting”) to approve the Company’s pending acquisition by funds managed by affiliates of Apollo (NYSE: APO). Under the terms of the merger agreement, Univar Solutions stockholders will receive $36.15 per share in cash for every share of Univar Solutions common stock they own immediately prior to the effective time of the merger.
At the Special Meeting, approximately 93.6% of the shares voted were voted in favor of the merger, which represented approximately 81.3% of the total outstanding shares of Univar Solutions common stock as of May 1, 2023, the record date for the Special Meeting.
Univar Solutions Stockholders Approve Acquisition by Apollo Funds
“We are pleased that our stockholders overwhelmingly supported our transaction with Apollo,” said Chris Pappas, chairman of the Univar Solutions Board of Directors. “We now shift our focus to the important next steps toward completing the transaction and maximizing value for Univar Solutions stockholders.”
Assuming timely satisfaction of necessary closing conditions, the transaction is expected to close in the second half of 2023.
The final voting results on the proposals voted on at the special meeting will be set forth in a Form 8-K filed by Univar Solutions with the U.S. Securities and Exchange Commission.
June 6, 2023
Polyurethane Foam Association Spring Meeting Focuses On Industry Challenges, New Opportunities For Flexible Foam
ST. PETERSBURG, FL (June 5, 2023)— At the Polyurethane Foam Association’s (PFA) recent Spring meeting in St. Petersburg, the association covered a spectrum of issues impacting the flexible polyurethane foam industry, along with looking at innovations that promise improvements in foam production, quality, and sustainability.
Record attendance saw more than 165 sales and marketing professionals, EHS specialists, technologists, entrepreneurs and C-suite executives join together for meetings, networking sessions, and presentations covering everything from the newest antioxidants to ways in which artificial intelligence may affect the industry.
PFA’s Industry Issues Session covered trends in key market segments, including commercial furniture, automotive, carpet cushion, and more. Other presentations addressed legal and regulatory issues, isocyanates, technical trends, sustainability and supply chain solutions such as nearshoring.
In the Technical Program on the following day, technical papers covered achievements in microbial control, alternative antioxidants, standards for measuring VOCs, and producing polyols from CO2.
Chip Holton of NCFI Polyurethanes, PFA’s President, recognized new PFA members including Ashley Furniture, Sinomax USA, and Hansa-Mixer. He noted that since the lifting of pandemic restrictions, 20 new companies have joined PFA.
“I think this is an indication of our value to the industry,” said Russ Batson, PFA Executive Director. “Since its creation more than 40 years ago, PFA has given the flexible polyurethane foam industry a more authoritative, more effective voice to represent itself to regulators, NGOs, consumers, and other key audiences. Members have proven that by working together, they can accomplish more than trying to confronting industry challenges on their own.”
Keynote speaker Dr. Balaji Padmanabhan of the University of South Florida provided an overview of Artificial Intelligence and how A.I. is likely to impact the business world in the next several years. Dr. Padmanabhan’s recounted the progress of his field from machine learning, to “traditional” A.I. to the “generative” A.I. currently receiving attention from the media and among investors. He explained that generative A.I. allows computers to produce texts, images and even musical compositions based on user-given prompts, templates or dialogue.
Liz Manning of Econic Technologies won the Dr. Herman Stone Technical Excellence Award. Her presentation, “Redeeming Carbon: CO2-Based Polyols for Polyurethane Applications,” was voted best by those attending the Technical Program.
The award is named for Dr. Herman T. Stone, a legendary figure in the flexible polyurethane foam industry who passed away earlier this year at the age of 98. He served as PFA’s first Technical Director. Dr. Stone left his mark on almost every aspect of the FPF industry, from lab research, process development, applications research and technological forecasting through regulatory compliance, patents and trademarks, and waste minimization and disposal. He pioneered much of the FPF industry’s flammability research and was a leader and an officer in the PFA and in other industry and national associations. In 2007, Dr. Stone was inducted into the Flexible Polyurethane Foam Hall of Fame.
Beyond his professional work, Dr. Stone spent much time educating young people on the importance of remembering the Holocaust. His own personal story appears in the Holocaust Museum in Washington, DC.
“Dr. Stone would have been particularly proud of the quality of the technical presentations this Spring,” noted Bill Gollnitz, Past President of PFA and Moderator for the Technical Program. “In the voting for the Technical Excellence Award (the winner is chosen by the audience in the Technical Session), every presentation received first place votes, and all finished within fractions of a point of each other.”
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