The sum will consist of $335 million in cash and certain assumed liabilities with the remainder in future proceeds based on the businesses’ performance.

Together, the businesses, which make well-known brands such as Bakelite, Durite, Cellobond and Resonance, posted sales of about $530 million for the year ending Jun. 30, 2020. They operate 11 manufacturing facilities worldwide, including three R&D/technology centers and four product support laboratories, serving the building and construction, industrial, automotive, electronics, agriculture and consumer markets.

The deal is scheduled to close in the first quarter of 2021, subject to regulatory approvals and customary conditions. Hexion expects to invest the sale proceeds in its remaining businesses and further reduce debt.

“We continue to strategically manage our portfolio providing us the ability to further strengthen our balance sheet and maintain a strong business going forward,” said Hexion chairman, president and CEO Craig Rogerson. “As we proceed, we will leverage our differentiated technology and global manufacturing footprint to serve the diversified customers of our remaining businesses.”

The investment firms, which have previously worked together, describe Hexion as a sizeable player in the phenolic resins space with an unmatched footprint in Europe, well diversified end-markets and geographies with leading market share in nearly all categories and premium-price positioning.

Funds managed by Investindustrial and Black Diamond own equal shares in Polynt-Reichhold, formed in 2017 from the merger between Italy’s Polynt and US-based Reichhold.

Hexion CEO returns to work

In separate news, Hexion announced on Sep. 14 that Rogerson has returned to work from medical leave. The sixty three-year old executive took a temporary leave of absence on Mar. 29 after contracting coronavirus.

Author: Elaine Burridge, Freelance Journalist