WEST PALM BEACH, FL -- Platform Specialty Products has a deal to acquire Alent for approximately $2.1 billion in cash and stock.
Including net debt, the total transaction value is approximately $2.3 billion. Platform said it expects annual pretax cost synergies of $50 million which would be fully realized in the three years after the transaction is completed.
Both companies' boards unanimously support the transaction, which is expected to close in late 2015 or early 2016 after the satisfaction of the applicable closing conditions and shareholder approvals.
Under the terms of the transaction, for each Alent share, Alent shareholders will receive 503 pence in cash. The transaction values Alent's entire issued and to be issued share capital at $2.1 billion (£1.35 billion), a premium of approximately 49% over Alent's closing price of 337.7 pence per share as of July 10.
The transaction will also include a partial share alternative under which eligible Alent shareholders can elect to receive Platform common stock in lieu of part or all of the cash consideration to which they would otherwise be entitled under the transaction (subject to pro rating in accordance with the terms of such partial share alternative).
Platform is also bidding for OMG's Electronic Chemicals unit in a separate $365 million transaction. It was founded through the acquisition of MacDermid in 2013.
Alent's business comprises two business segments: Enthone, a supplier of surface chemistries and electroplating materials to the electronics, automotive and industrial industries, and Alpha, which makes solder and other interconnect materials, primarily for electronics.
"Alent is a highly attractive business with compelling growth prospects and a proven financial track record. Platform believes the transaction will allow it to combine complementary product portfolios and geographical footprints. Additionally, it will improve the geographic range and product capabilities in surface treatment, expand Platform's product offering and provide an opportunity to unlock substantial value through the realization of material costs synergies and sales growth opportunities.
In a statement announcing the bid, Platform founder and chairman Martin E. Franklin said, "The proposed acquisition of Alent marks a further step in the Platform strategy of building a portfolio of best-in-class 'Asset-Lite, High-Touch' businesses in the specialty chemicals industry. This business and acquisition fits well within our stated objectives, and we are compelled by the value creation the combination may generate."
Platform chief executive Daniel H. Leever added, "Alent is a strong complement to Platform's founding asset MacDermid, and I am excited to see it become a part of the Platform family. We have a long history with Alent and its predecessor company, and these are assets we know well. We believe the synergy potential is significant as is our combined ability to deliver better technology and service to our customers. Alent's Enthone division represents a perfect partner as we continue to grow and build MacDermid whilst Alent's Alpha division adds several new high return positions to our portfolio."
Alent chief executive Andrew Heath supported the deal, saying, "The combination with Platform ... is a compelling proposition which I believe will be better able to serve customers and provide even greater opportunities for our employees. Our board is unanimous in its recommendation of the proposed transaction."
