11th Sep 2018 08:52
LONDON (Alliance News) - Elementis PLC said Tuesday it will now pay USD553 million to acquire Dutch industrial talc mineral additive firm Mondo Minerals Holding BV instead of USD600 million agreed previously.
The UK listed chemicals company, which was forced to reconsider the Mondo deal due to shareholder concerns, will pay USD500 million in cash to Advent Mondo (Luxembourg) Sarl to buy Mondo plus USD53.0 million in earn-out payments upon subject to the achievement of certain performance targets by Mondo.
"Following engagement with our shareholders, we have agreed terms of a revised deal with Advent that we believe represents compelling value. We remain excited by Mondo's prospects and the significant opportunities we believe this acquisition will unlock for Elementis," Chief Executive Paul Waterman said.
Elementis expects the revised agreement to be accretive to adjusted earnings per share in the first full year following completion, excluding any benefit other than modest pre-tax cost synergies. It intends to fund the deal via a USD230 million rights issue of shares and by utilising a new USD775.0 million term and revolving credit facility.
The right issue will be on the basis of 1 new ordinary share at 152.0 pence per share for every 4 existing shares, and Elementis will offer up to 116.0 million new shares.
Elementis will drawn down USD600.0 million under the loan agreement to fund part of the cash consideration for the acquisition and to refinance some debt of Mondo and Elementis.
Elementis expects to complete the Mondo deal by October 23. Shares in Elementis were trading 4.3% lower at 242.00 pence each on Tuesday morning.
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