Cleanzine: your weekly cleaning and hygiene industry newsletter 18th April 2024 Issue no. 1110
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Sealed Air announces sale of New Diversey to Bain Capital Private Equity for approximately $3.2 billion
Sealed Air Corporation has today announced that it has entered into a definitive agreement to sell its Diversey Care division and the food hygiene and cleaning business currently within its Food Care division (together 'New Diversey') to Bain Capital Private Equity, for approximately $3.2 billion.
The acquisition includes a formal offer to acquire certain of Diversey's business in France and the Netherlands, which may be accepted following Works Council consultation.
New Diversey provides hygiene and cleaning solutions that integrate chemicals, floorcare machines, tools and equipment, with a wide range of technology based value-added services, food safety services and water and energy management. New Diversey will continue to employ approximately 8,600 people globally. Diversey Care and the related food hygiene businesses combined generated net sales of approximately $2.6 billion in 2016.
The sale is expected to close in the second half of 2017 and is subject to certain regulatory approvals and customary closing conditions.
"We are pleased that New Diversey has a strong partner to support future growth initiatives and drive further expansion," said Jerome A. Peribere, president and CEO (pictured).
"Diversey Care and its related hygiene business has built an impressive innovation pipeline that includes the Internet of Clean, robotics and AHP disinfection technologies, revamped its go-to-market strategy and significantly improved profitability
"New Sealed Air, a leading provider of food, product and medical packaging solutions, will continue to focus on accelerating profitable growth and generating strong cash flow through end market opportunities and the global adoption of new products and solutions.
"Sealed Air's advanced product portfolio is designed to reduce waste, conserve resources and provide product security, and deliver measurable value to customers and the planet."
Ken Hanau, a managing director at Bain Capital Private Equity, added: "Diversey has a long track record of leadership in the hygiene and cleaning solutions market on a global basis.
"We are excited to partner with the talented team at Diversey to grow across key market verticals and geographies while investing in innovative hygiene solutions. Bain Capital's integrated global platform and strong growth orientation are well aligned with the strategic vision for Diversey."
The sale is expected to close in the second half of 2017 and is subject to certain regulatory approvals and customary closing conditions.
Upon closing of the transaction, Sealed Air expects to use the proceeds to repay debt and maintain its net leverage ratio in the range of 3.5 to 4.0 times, repurchase shares to minimise earnings dilution, and fund core growth initiatives, including potential complementary acquisitions to its Food Care and Product Care divisions.
Sealed Air's board of directors has authorised an increase of the share repurchase programme by an additional $1.5 billion of Sealed Air common stock. With this increase, the total authorisation for future repurchases under the program is approximately $2.2 billion.
The Board has also determined that Sealed Air will maintain its quarterly cash dividend of $0.16 per common share while the company reduces earnings dilution. Following past practices, the Board will continue to evaluate the quarterly cash dividend annually.
The results of operations of New Diversey will be reported as discontinued operations beginning in the first quarter of 2017. Sealed Air is tentatively scheduled to report its first quarter 2017 results on 9th May, 2017.
30th March 2017