1st July 2016
Synthomer Plc
Completion of Hexion PAC acquisition and pre close trading update
Further to the announcement on 21 March 2016, Synthomer Plc (LSE: SYNT) ('Synthomer' or the 'Group') today announces that it has successfully completed the acquisition of HEXION Performance Adhesives & Coatings ('HEXION PAC') from HEXION Inc. Hexion PAC's business in China (representing approximately 1% of Hexion PAC's revenues) is subject to a deferred completion which is expected in Q3 2016.
The total consideration of $226 million (£157 million) was funded from both existing cash resources and utilisation of additional credit facilities. The consideration was hedged at the time of the initial announcement on 21 March at an FX rate of £1:US$1.44.
The acquisition of HEXION PAC significantly strengthens Synthomer's position in the performance adhesives and coatings market, offering access to new product technologies, customers and markets. HEXION PAC is also highly complementary to Synthomer's existing business both geographically and in the markets in which it operates. The completion of the acquisition will give Synthomer a stronger platform from which to continue its growth aspirations in the Speciality Coatings market.
Trading Update
Ahead of reporting Interim Results on 9th August 2016, the Group confirms that its outlook for Full Year 2016 in constant currency remains unchanged and in line with the Board's expectations.
Foreign Currency
As highlighted at the time of the Preliminary Results, the Group is exposed to movements in foreign currency and the impact that this can have on the translation of its overseas earnings, particularly the Euro and the US$.
For guidance, given the current strengthening of the Euro and the US$ vs Sterling, a €0.01 and $0.01 increase in the FX rates relative to Sterling are estimated to result in an improvement in the Sterling reported full year results by approximately £0.5m and £0.25m respectively. An update on foreign currency will be provided in the Interim Results Announcement on 9 August.
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Enquiries:
Calum MacLean, Chief Executive Officer |
Tel: + 44 (0) 1279 436 211 |
Stephen Bennett, Chief Financial Officer |
Tel: + 44 (0) 1279 775 250 |
Charles Armitstead, Teneo Strategy |
Tel: + 44 (0) 207 240 2486 |
