MOSCOW (MRC) -- Trinseo, a global materials company and manufacturer of plastics, latex binders and synthetic rubber, has announced its entry into an agreement with SK AA Holdings, LLC, an affiliate of Falcon Private Holdings, LLC, to acquire Aristech Surfaces LLC, a leading North American manufacturer and global provider of polymethyl methacrylates (PMMA) continuous cast and solid surface sheets, serving the wellness, architectural, transportation and industrial markets, as per the company's press release.
“The acquisition of Aristech allows us to provide a full offering of PMMA technologies and innovative products that serve customers in new, high-growth markets,” said Frank Bozich, Trinseo President and Chief Executive Officer. “This is an important next step towards our goal of becoming a global specialty materials and sustainable solutions provider. We are eager to welcome the Aristech team and we believe the complementary technical capabilities and focus on customer relationships will drive superior results for the PMMA business globally.”
The transaction is expected to generate approximately USD10 million in annual pretax cost synergies by 2024 and additional revenue synergies by leveraging Trinseo’s footprint and customer relationships in North America, Europe and Asia. The collective technical and commercial teams will work together to accelerate growth and deliver meaningful value to shareholders.
Aristech is a global leading producer of continuous cast acrylic sheet for the wellness, architectural, transportation and industrial markets. Aristech’s products are used for a variety of applications, including the construction of hot tubs, swim spas, counter tops, signage, bath products and recreational vehicles. Aristech’s high margin profile and strong cash flow conversion is expected to drive long-term value for shareholders. The business will become part of Trinseo’s Engineered Materials segment.
The transaction is expected to be funded with cash on hand and existing credit facilities. Trinseo expects its net leverage ratio to be in the low-2x range at the end of the year, including proforma adjustments for the Synthetic Rubber divestiture and the Aristech and Arkema PMMA acquisitions. Trinseo anticipates the transaction will close by year-end 2021 subject to customary closing conditions and regulatory approvals.
As MRC reported earlier, in May, 2021, Trinseo announced the closing of the previously announced transaction to acquire Arkema’s polymethyl methacrylates (PMMA) business. PMMA is a transparent and rigid resin with a wide range of end uses that augments Trinseo’s existing offerings across several end markets including automotive, building and construction, medical and consumer electronics.
The main application, consuming approximately 75% MMA, is in the production of polymethyl methacrylate acrylic plastics (PMMA). Methyl methacrylate is also used to produce methyl methacrylate-butadiene-styrene copolymer (MBS), used as a modifier for polyvinyl chloride (PVC).
According to MRC's ScanPlast report, Russia's overall production of unmixed PVC totalled 515,900 tonnes in the first half of 2021, up by 1% year on year. At the same time, two producers reduced their output.
Trinseo is a global materials company and manufacturer of plastics, latex and rubber. Trinseo's technology is used by customers in industries such as home appliances, automotive, building & construction, carpet, consumer electronics, consumer goods, electrical & lighting, medical, packaging, paper & paperboard, rubber goods and tires. Formerly known as Styron, Trinseo completed its renaming process in 1Q 2015. Trinseo had approximately USD3.0 billion in net sales in 2020, with 17 manufacturing sites around the world, and approximately 2,600 employees.