Element Solutions Inc. · NYSE:ESI
Element Solutions — Platform Specialty Products — Merger or Acquisition (April 2014)
22 slides from Element Solutions's merger presentation, Apr 17, 2014
Slide 1: Acquisition of Chemtura AgroSolutions
Acquisition of Chemtura AgroSolutions Investor Presentation April 17, 2014 0
Slide 2: Disclaimer
Disclaimer Please note that this presentation is intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. In this presentation, we may discuss events or results that have not yet occurred or been realized, commonly referred to as “fo
Slide 3: Agenda
Agenda Transaction Overview Chemtura AgroSolutions Overview Strategic Rationale Financial Overview Q&A 2
Slide 4: Platform to Acquire Chemtura AgroSolutions
Platform to Acquire Chemtura AgroSolutions On April 17th, 2014, Platform announced a definitive agreement to acquire Chemtura AgroSolutions (“CAS”) adding a new vertical Platform Specialty Products Coatings Water Market Electronic Oilfield Surface Crop Packaging Adhesives (Niche Treatment Segment: M
Slide 5: Transaction Overview
Transaction Overview Total consideration value of approximately $1 billion. − Cash purchase price of $950 million, subject to working capital and other adjustments Overview − Stock consideration of 2 million common shares of Platform − Implied Multiple of 9.8x 2013 EBITDA pre-synergies Accretive
Slide 6: CAS is a Perfect Match to our Strategic Criteria for Acquisitions
CAS is a Perfect Match to our Strategic Criteria for Acquisitions Platform’s Investment Criteria “Asset-Lite, High-Touch” Business Model that Drives Free Cash Flow Experienced Management Team with Track Record of Success Leading Positions in Niche Markets Diversified Revenue Base A
Slide 7: CAS Enhances Platform's Scale and Growth Profile
CAS Enhances Platform’s Scale and Growth Profile 2013 Combined Net Sales 2013 Combined Adjusted EBITDA ($ mm) ($ mm) 1,500 400 $1,195 300 $281 (1) 1,000 $746 Scale 200 $180 500 100 0 0 Platform Combined Platform Combined 2013 Platform Net Sales 2013 Combined Net Sales Graphic Graphic Solutions Solut
Slide 8: Agenda
Agenda Transaction Overview Chemtura AgroSolutions Overview Strategic Rationale Financial Overview Q&A 7
Slide 9: CAS – Business Overview
CAS – Business Overview CAS is a leading and fast growing provider of agrochemicals and seed treatment products for a wide variety of crop applications Business Description Key Products and End-Uses Key Performance Drivers Key Products Key End-Use Applications Seed Enhancement Tree nuts, fruits,
Slide 10: CAS – Geographic Diversification
CAS – Geographic Diversification Global distribution footprint with sales in 100+ countries with a presence in fast growing economies Sales by Region 100+ CAS Locations Worldwide Latin America EMEA Asia Pacific North America 9
Slide 11: Crop Protection: Favorable and Sustainable Industry Fundamentals
Crop Protection: Favorable and Sustainable Industry Fundamentals Several global mega-trends require ever increasing yields and protections for crops Overview Global Population Growth and Arable Land Per Capita Long term demand for agriculture products is expected to increase significantly due to:
Slide 12: Agenda
Agenda Transaction Overview Chemtura AgroSolutions Overview Strategic Rationale Financial Overview Q&A 11
Slide 13: Acquisition of CAS: Strategic Rationale
Acquisition of CAS: Strategic Rationale Double high value positioning – high-tech, high-touch “Asset-Lite, High-Touch” Value-added R&D, global product registration process, sales and customer service Business Model Strong Free Cash Flow generation with limited exposure to petrochemical-based r
Slide 14: Agenda
Agenda Transaction Overview Chemtura AgroSolutions Overview Strategic Rationale Financial Overview Q&A 13
Slide 15: Platform's Historical Performance
Platform’s Historical Performance Net Sales Adjusted EBITDA and % of Sales (3) ($ in millions) ($ in millions) $744 $746 $180 $729 $731 $694 $162 $160 $172 $153 $160 $172 $43 $594 $158 $139 $42 $34 $145 $116 $28 $106 $17 $23 $584 $569 $559 $574 $536 $137 $119 $120 $449 $111 $100 $83 15.6% 17.8% 20.0
Slide 16: Combined Financials
Combined Financials CAS Enhances our Operating and Financial Metrics ($ millions, except per share data) Chemtura Platform AgroSolutions Combined 12 months Ended 12 months Ended 12 months Ended 12/31/2013 12/31/2013 12/31/2013 Net Sales $746 $449 $1,195 Adjusted EBIT (1) $135 $89 $224 % margin 18.1%
Slide 17: Strategic and Financial Highlights of the Transaction
Strategic and Financial Highlights of the Transaction Natural fit in our portfolio of “Asset-Lite, High-Touch” specialty chemicals businesses with leading positions in niche categories Enhances Platform’s portfolio Establishes strong vehicle for future growth supported by mega-trends and barri
Slide 18: Agenda
Agenda Transaction Overview Chemtura AgroSolutions Overview Strategic Rationale Financial Overview Q&A 17
Slide 19: Appendix
x PLATFORM SPECIALTY /_N PRODUCTS CORPORATION Appendix 18
Slide 20: Accretion Dilution Analysis
Accretion Dilution Analysis ($ in millions) Full Year 2013 Platform Combined as Adjusted Diluted EPS $0.68 Combined as Adjusted Diluted Share Count (1) 132.5 Combined as Adjusted Net Income $90 Transaction Adjustment for Acquisition of Chemtura AgroSolutions All Debt (3) Equity Issuance (2) Chemtura
Slide 21: Platform Reconciliation of Net Income to Adjusted EBITDA
Platform Reconciliation of Net Income to Adjusted EBITDA Predecessor/Successor Combined Year ended December 31 (in millions) 2012 2013 Net income (loss) $46.0 $(181.0) Adjustments to reconcile to net income (loss): Income tax expense (benefit) 24.6 7.1 Interest expense 49.7 51.8 Depreciation and amo
Slide 22: Chemtura AgroSolutions' Non-GAAP Financials
Chemtura AgroSolutions’ Non-GAAP Financials ($ millions) Chemtura AgroSolutions 12 months Ended 12/31/2013 Net Sales per Chemtura 2013 10-K $449 Segment Operating Income per Chemtura 2013 10-K $88 % margin 19.6% Depreciation and Amortization per Chemtura 2013 10-K $12 % of sales 2.7% Stock-based Com
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