Ingevity Corporation · NYSE:NGVT
Ingevity — Merger or Acquisition (August 2017)
11 slides from Ingevity's merger presentation, Aug 22, 2017
Slide 1: Ingevity Announces Agreement to Acquire Georgia-Pacific's Pine Chemicals Business
Ingevity Announces Agreement to Acquire Georgia - Pacific’s Pine Chemicals Business August 23, 2017
Slide 2: Disclaimer
Disclaimer This presentation contains “forward - looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward looking statements generally include the words “may,” “could,” “should,” “believes,” “plans,” “intends,” “targets,” “will,” “ exp ects,” “sugg
Slide 3: Transaction Overview
Transaction Overview Transaction Value ▪ Purchase price of $ 315 million ▪ Expected EPS accretive in year one ▪ Targeted net synergies of approximately $11 million, representing about 10 percent of sales ▪ 10.2x 2017E EBITDA excluding synergies and 7.5x 2017E EBITDA including run - rate synergies ▪
Slide 4: Strategic Rationale
Strategic Rationale ▪ Acquisition further strengthens Ingevity’s leading position in Performance Chemicals ▪ Business combination adds scale ▪ Highly complementary technology and product offerings ▪ Minimal customer overlap ▪ Additional long - term CTO supply security at market price ▪ Significant v
Slide 5: Acquisition Adds Scale in Performance Chemicals
Acquisition Adds Scale in Performance Chemicals Locations: Three plants provide flexible and more efficient manufacturing network N. Charleston, SC DeRidder, LA Crossett, AR 125 105 (1) LTM sales of Georgia - Pacific's pine chemicals business have been derived from unaudited financial records prepar
Slide 6: The Businesses are Complementary
The Businesses are Complementary Combined Business Leading Technologies • Pavement - Warm mix asphalt • Agriculture – Lignin - based dispersants • Oilfield – Drilling emulsifiers • Inks – High - quality resins • Adhesives – Lower color • Rubber – Specialty rosins for rubber chemicals • Oilfield – Em
Slide 7: Significant, Highly Achievable Operational Synergies
$6M $5M Source: Company data. Logistics Manufacturing Description Target Capital Requirements • Lower transportation costs • Warehousing op timization • Optimize product mix at all sites • Improve yield by maximizing operating rate at most effective sites • Leverage procurement x None None Core Inge
Slide 8: Highly Attractive Acquisition Financing
Highly Attractive Acquisition Financing ▪ Financed with $75 million term loan A increase; balance from revolver ▪ Revolver upsized to $ 550M ▪ Term loan A increase to $375 million ▪ Attractive rates of LIBOR +175 bps ▪ Significant tax asset step - up provides approximately $50 million of NPV (presen
Slide 9: Summary
Summary ▪ Acquisition adds scale and competitiveness to Performance Chemicals segment ▪ The businesses are complementary ▪ Broader technologies and products; m inimal customer overlap ; n ew geographies for G - P products ▪ Highly achievable, expected net synergies of about $11 million ▪ Lower logis
Slide 10: Appendix
Appendix 10
Slide 11: Non-GAAP Financial Measures
Non - GAAP Financial Measures Ingevity has presented certain financial measures, defined below, which have not been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and has provided a reconciliation to the most directly comparable financial measure calculated in acc