Ashland Inc. · NYSE:ASH
Ashland — Ashland Global Holdings — Merger or Acquisition (April 2017)
12 slides from Ashland's merger presentation, Apr 17, 2017
Slide 1: Ashland Announces Agreement to Acquire Pharmachem Laboratories, Inc.
Ashland Global Holdings Inc. Announces Agreement to Acquire Pharmachem Laboratories, Inc. April 17, 2017
Slide 2: Forward-Looking Statements
Forward-Looking StatementsThis presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Ashland has identified some of these forward-looking statements with words s
Slide 3: Transaction Overview
Transaction Overview Purchase price of $660 millionTransaction to be funded with bank financing and available cashTransaction multiple of ~10.5x Pharmachem’s estimated fiscal 2017 adjusted EBITDA; ~7.5x after adjusting for expected cost synergies and tax optimizationExpected to be accretive to earni
Slide 4: Pharmachem Overview
Pharmachem Overview Revenue of ~$300 million and adjusted EBITDA margin of ~20%Privately held; majority family ownedLeading international provider of (i) customized solutions and high quality ingredients to the global health and wellness industries and (ii) high value, differentiated products to fra
Slide 5: Strategic Rationale
Strategic Rationale Strengthens our existing business with advanced processingknow-how and formulation expertise Leverages our customization capabilities into niches where we create valueHigh customer-intimacy sales model emphasizing custom / tailored productsCreates unique industry offering: levera
Slide 6: Synergies
Synergies Expected annual cost synergies of ~$10 million, primarily driven by leverage from Ashland’s scale and infrastructure, de-tolling opportunities and in-sourcing initiativesCost synergies expected to be realized by end of second year following transaction closeIncremental tax synergies with e
Slide 7: Financial Impact
Financial Impact Expected to be accretive to EPS in first year following close of the transaction and to enhance long-term EPS growthStrong cash flow generation Attractive double-digit returnsAccretive to EBITDA marginsFinanced primarily with bank financing with remainder from cash on handAverage co
Slide 8: Pro Forma Combination
Nutrition & Health Pro Forma Combination Revenue Revenue By End Market Net Debt / Adjusted EBITDA Pro Forma (Post-Valvoline Separation) (Post-Valvoline Separation) LTM as of December 31, 2016 $3.0 bn(1) $0.3 bn $3.3 bn 3.0x(2) 3.8x(3) Pharmachem Represents Ashland Specialty Ingredients and Ashland P
Slide 9: Summary
Summary Acquisition of Pharmachem strengthens our existing business with advanced processing know-how and formulation expertiseEnhances Ashland’s position in the high growth nutraceutical end markets and opens up a new market opportunity in fragrance and flavorsCreates unique industry offering by le
Slide 10: Near-Term Calendar
Near-Term Calendar Ashland plans to report financial results for Q2 FY 2017 after the NYSE closes on April 25 and to host a webcast with investors the following morning on April 26Ashland Investor Day scheduled for May 1 in New York CityThe full separation of Valvoline remains on trackSubject to mar
Slide 11: Ashland: always solving
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Slide 12: Reconciliation of Non-GAAP Data for 12 Months Ended December 31, 2016
Ashland Global Holdings Inc. and Consolidated SubsidiariesReconciliation of Non-GAAP Data for 12 Months Ended December 31, 2016 North America2__% Asia Pacific__% LatinAmerica/Other - _% Europe __% AshlandSpecialtyIngredients__% AshlandPerformanceMaterials__% Valvoline__% 1 Quarterly totals may not s
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