Synthomer (LSE:SYNT) PLC has sold its laminates, films and coated fabrics businesses to Surteco North America for around £208mln as it continues its plans to shed non-core assets.
The UK chemicals business, formerly known as Yule Catto & Co., said net proceeds from the deal are expected to be around £199mln and will be used to reduce debt as the group continues to target a range of 1 to 2 times net debt to EBITDA over the medium term.
Synthomer (LSE:SYNT) said the consideration implies an EV/EBITDA multiple of 8 times based on the EBITDA for the 12 months to 31 December 2021, which compares favourably with the multiple of around 7 times achieved in the OMNOVA acquisition in April 2020.
The deal should be completed in quarter one 2023.
Synthomer (LSE:SYNT)'s CEO, Michael Willome, said: “This divestment is consistent with our recently announced strategy to increase the specialty weighting of our portfolio and focus on higher value, higher growth markets where we have strong and sustainable leadership positions.”
“The proceeds represent excellent value for our shareholders and the transaction is a significant step in the deleveraging of the group.”