H.B. Fuller Poised for Global Growth with Acquisition of Royal Adhesives & Sealants
(Thomson Reuters ONE) -
ST. PAUL, Minn., Oct. 22, 2017 (GLOBE NEWSWIRE) -- Boosting H.B. Fuller's
(NYSE:FUL) problem-solving potential, the company today announces it has
finalized its acquisition of Royal Adhesives & Sealants for $1.575 billion. Few
people realize the impact of adhesives. They are everywhere, making virtually
any durable or consumer product better. Adhesives have the potential to make the
world a better place, and H.B. Fuller is tapping adhesives in unique ways to
improve a range of global issues.
H.B. Fuller, combined with Royal, deepens its expertise in specialty and high-
value applications used in a range of sectors, including electronics, hygiene,
medical, transportation, clean energy, construction, and more. Together, the
companies will enable an interconnected world, support better use of the world's
finite resources, improve food security and access to clean drinking water, and
address the challenges of a globally disperse and aging population.
"This is an exciting step for Royal and our network of brands," said Royal
Adhesives & Sealants CEO, Ted Clark. "Combining these two businesses creates a
more capable and dynamic company for our customers and employees. We complement
each other, selling in adjacent markets with very little customer overlap, and
that presents an interesting number of growth opportunities. We offer different
technologies, expertise and capabilities. Yet, we share the same passion for
solving product development challenges by discovering and applying innovations
in adhesive technology."
The acquisition expands H.B. Fuller's product offering in engineering, durable
assembly and construction adhesives and makes H.B. Fuller the world's largest
supplier of adhesives for insulating glass and commercial roofing applications.
Of the top adhesives manufacturers, H.B. Fuller is the only one singularly
focused on adhesive and sealant technologies.
"We are passionate about being the best adhesives provider in the world, and
we've been investing significantly over the last decade to make it a reality,"
said H.B. Fuller CEO Jim Owens. "With complementary adhesives expertise from
Royal, we're able to make an even bigger impact on improving people's lives. Our
customers will benefit from a broader portfolio and expanded development and
production capabilities. We'll be a more capable and dynamic company with
additional opportunities for the thousands of dedicated H.B. Fuller and Royal
employees around the world. And, the acquisition accelerates our business
strategy and positions us to exceed our 2020 targets."
H.B. Fuller also expects the combined businesses to deliver very strong cash
flow to pay down debt at an accelerated pace. Owens adds, "With this
acquisition, we have created immediate value for shareholders based on Royal's
solid organic growth track record, high EBITDA margin and strong rate of cash
flow conversion. Looking ahead, we will now begin our planned three-year
integration, including leveraging the $15 million in growth synergies and $35
million in cost synergies we identified prior to closing this transaction."
A broader range of highly specified adhesives technologies
With the addition of Royal, H.B. Fuller will be able to add more value to its
customers in key markets that require highly specified adhesive technology. The
combined companies' comprehensive suite of products support innovative product
design with the potential to touch everything from our clothes, homes and
workspaces to how we communicate and travel.
For example, the electronification of cars has revolutionized vehicles from
mechanical machines to electronic devices, and it is changing how vehicles are
manufactured and serviced. Together, H.B. Fuller and Royal now bring the whole
package to OEMs - from electronics applications, interior trim, and interior and
exterior lighting to powertrain under the hood and exterior structural bonding.
Royal also brings rubber-to-metal bonding adhesives, a highly difficult
application in the automotive industry.
From engineered wood applications and panel lamination to advancements in
insulating glass, H.B. Fuller now has one of the world's most complete lines of
durable assembly adhesive offerings. The acquisition of
Royal's KÖMMERLING business-a well-established and respected provider of
insulating glass and other high-value adhesive and sealant applications for
manufacturers of durable goods-will enable us to leverage its well-established
sales channels to deliver this technology to a broader range of customers in
North America and to accelerate the introduction of insulating glass sealant
innovations in China and the Asia Pacific region.
The acquisition also nearly doubles the size of H.B. Fuller's construction
adhesives portfolio. Adding to H.B. Fuller's expertise in tile setting and
flooring installation, Royal is the market leader in the commercial low-slope
roofing category. They also add capabilities in insulation attachment and
waterproof bonding. Collectively, H.B. Fuller now advances quality building
construction from the floor to the roof.
H.B. Fuller has acquired Royal from affiliates of American Securities LLC, based
in New York with an office in Shanghai. To learn more about the transaction,
visit www.hbfuller.com/royal.
About H.B. Fuller Company:
Since 1887, H.B. Fuller has been a leading global adhesives provider focusing on
perfecting adhesives, sealants and other specialty chemical products to improve
products and lives. With fiscal 2017 pro forma net revenue of over $2.8 billion,
H.B. Fuller's commitment to innovation brings together people, products and
processes that answer and solve some of the world's biggest challenges. Our
reliable, responsive service creates lasting, rewarding connections with
customers in electronics, disposable hygiene, medical, transportation,
aerospace, clean energy, packaging, construction, woodworking, general
industries and other consumer businesses. And, our promise to our people
connects them with opportunities to innovate and thrive. For more information,
visit us at www.hbfuller.com.
Safe Harbor for Forward-Looking Statements:
Certain statements in this document may be considered forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995.
These statements are subject to various risks and uncertainties, including but
not limited to the following: the Royal transaction may involve unexpected costs
or liabilities; our business or stock price may suffer as a result of
uncertainty surrounding the transaction; the substantial amount of debt we have
incurred to finance our acquisition of Royal, our ability to repay or refinance
it or incur additional debt in the future, our need for a significant amount of
cash to service and repay the debt and to pay dividends on our common stock, and
the effect of restrictions contained in our debt agreements that limit the
discretion of management in operating the business or ability to pay dividends;
various risks to stockholders of not receiving dividends and risks to our
ability to pursue growth opportunities if we continue to pay dividends according
to the current dividend policy; we may be unable to achieve expected synergies
and operating efficiencies from the transaction within the expected time frames
or at all; we may be unable to successfully integrate Royal's operations into
our own, or such integration may be more difficult, time consuming or costly
than expected; following the transaction, revenues may be lower than expected,
and operating costs, customer loss and business disruption (including, without
limitation, difficulties in maintaining relationships with employees, customers,
clients or suppliers) may be greater than expected; risks that the transaction
disrupts current plans and operations and the potential difficulties in employee
retention as a result of the transaction; the ability to effectively implement
Project ONE; political and economic conditions; product demand; competitive
products and pricing; costs of and savings from restructuring initiatives;
geographic and product mix; availability and price of raw materials; the
Company's relationships with its major customers and suppliers; changes in tax
laws and tariffs; devaluations and other foreign exchange rate fluctuations; the
impact of litigation and environmental matters; the effect of new accounting
pronouncements and accounting charges and credits; and similar matters. Further
information about the various risks and uncertainties can be found in the
Company's SEC 10-K filing for the fiscal year ended December 3, 2016, and its
SEC 10-Q filing for the quarter ended September 2, 2017. All forward-looking
information represents management's best judgment as of this date based on
information currently available that in the future may prove to have been
inaccurate. Additionally, the variety of products sold by the Company and the
regions where the Company does business make it difficult to determine with
certainty the increases or decreases in net revenue resulting from changes in
the volume of products sold, currency impact, changes in product mix, and
selling prices. However, management's best estimates of these changes as well as
changes in other factors have been included.
Editor note: Please visit the online newsroom for additional supporting content
including quotes, video and photography.
Meagan Barnard
Inprela Communications
+1 612 677 2036
meagan(at)inprela.com
Max Marcy
H.B. Fuller Investor Relations
+1 651 236 5062
max.marcy(at)hbfuller.com
This announcement is distributed by Nasdaq Corporate Solutions on behalf of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: H.B. Fuller Company via GlobeNewswire
Unternehmensinformation / Kurzprofil:
Datum: 23.10.2017 - 02:00 Uhr
Sprache: Deutsch
News-ID 564648
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contact information:
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Kategorie:
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