Rockwood Holdings, Inc. (NYSE:ROC) announced today that it entered into a definitive agreement to sell its Titanium Dioxide Pigments and four other non-strategic businesses to Huntsman Corporation (NYSE: HUN), a global specialty chemical company, for an enterprise value of $1.325 billion, including the assumption of $225 million in pension obligations, and subject to other customary adjustments. This transaction is expected to close during the first half of 2014, following receipt of regulatory approvals.
The businesses being sold include Titanium Dioxide Pigments, Color Pigments & Services, Timber Treatment Chemicals, Rubber/Thermoplastics Compounding, and Water Chemistry. These businesses had combined net sales of $1,450.8 million and $1,539.0 million for twelve months ended December 31, 2012 and last twelve months (LTM) ended June 30, 2013, respectively.
“With the sale of these businesses, we have successfully completed, ahead of schedule, all of our key objectives for 2013,” said Seifi Ghasemi, Chairman and Chief Executive Officer. “In January of 2013, we announced a plan consisting of four strategic initiatives to further maximize shareholder value. We have delivered on all of them as follows:
- Repurchase $400 million of common shares: Acquired 6.23 million shares at an average price of $64.17/per share, completing the current program on September 5.
- Target dividend yield of 2.8% to 3.2%: Raised our quarterly dividend by nearly 30% to $0.45 per share from $0.35 per share in 2012.
- Repay debt of up to $600 million: Repaid more than $1.43 billion in principal loans related to secured term debt.
- Launch strategic process for non-core businesses: Concluded our process with the sale of seven non-strategic businesses for enterprise value aggregating approximately $3.9 billion, including Advanced Ceramics for EUR 1.49 billion, Clay Based Additives for USD 635 million and Titanium Dioxide Pigments and Other Non-Strategic Businesses for USD 1.325 billion, after adjusting for assumed pension obligations.
“With the completion of these initiatives, Rockwood has reached a significant milestone in its eight-year history since its IPO in August 2005 and is now uniquely positioned to grow within the specialty chemical sector. We remain committed to a disciplined approach in implementing our long-term business strategy, which is to further enhance shareholder value by creating a premier global specialty chemical company with market leading positions in all of its businesses,” added Mr. Ghasemi.