Business
Agreement to Sell Majority of PTIC Announcement
Agreement to Sell Majority of PTIC Announcement.
About this update from Croda International Plc
[{"type":"text","content":"\n \n \n \n RNS Number : 4709W\n Croda International PLC\n 22 December 2021\n \n \n \n Press Release \n \n 22 December 2021\n Agreement to sell majority of Performance Technologies and Industrial Chemicals businesses; completes Croda's transition into a dedicated Consumer Care and Life Sciences company\n \n THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION\n \n \n Croda International Plc (\"Croda\" or the \"Group\"), which uses smart science to create high performance ingredients and technologies that improve lives, today announces that it has signed a definitive agreement (\"the transaction\") to sell the majority of its Performance Technologies and Industrial Chemicals (\"PTIC\") businesses (\"the divested business\") to Cargill Velocity Holdings Limited, a wholly owned subsidiary of Cargill Inc (\"Cargill\" or \"the acquirer\") for an enterprise value of €915m (approximately £778m) on a cash-free, debt-free basis. The transaction follows a comprehensive strategic review of PTIC, announced in May 2021, to determine the best ownership structure to ensure the future success of the business.\n \n \n The divested business, which represented 77% of PTIC's 2020 revenue, is comprised of five manufacturing facilities, including the Gouda plant in the Netherlands, the Hull plant in the UK and Croda Sipo in China (a joint venture in which Croda owns 65%), together with additional laboratory facilities supporting key aspects of the divested business' activities in Smart Materials, Energy Technologies and Industrial Chemicals. The consideration of €915m includes 100% of Sipo in the divested business. If the sale of 100% of Sipo cannot be realised, Sipo will be excluded from the sale, reducing the consideration by €140m. \n \n \n The retained parts of PTIC will provide integral support to the Group's Consumer Care and Life Sciences sectors. These retained activities will become the Industrial Specialties (\"IS\") sector and play a key role in Croda's integrated model. Going forward, IS will generate additional revenues from a new \n supply agreement, whereby Croda will supply certain ingredients from its retained manufacturing plants to the acquirer. Similarly, the acquirer will enter a supply agreement to provide Croda with certain ingredients from the divested business' manufacturing plants.\n \n \n The divestment delivers C...