Apr 17 2004
Noveon International, Inc. announced today that it has entered into a definitive agreement for the sale of the Company to The Lubrizol Corporation (NSYE: LZ). The acquisition, which has been approved by the board of directors of both companies, is subject to regulatory approval and is expected to close within three months.
The transaction value includes a cash payment of $920.2 million for equity and the assumption of net debt which was approximately $920 million as of December 31, 2003. As a result of the transaction, Noveon will withdraw its registration statement with the SEC for its initial public offering.
"The strengths of Noveon and Lubrizol complement each other well," said Steve Demetriou, Noveon's president and chief executive officer. "This agreement will be value-added for both companies and our respective customers, and will enable the combined organization to build upon the successful foundation we have established at Noveon. Since its inception, three years ago, Noveon has transformed itself into a leading specialty chemical company, revitalized its businesses and reinvigorated its product pipeline. The value we have created at Noveon is reflected by our recent accomplishments which have included eight consecutive quarters of year-over-year sales growth, relentless pursuit of best-in-class productivity initiatives, successful bolt-on acquisitions and global expansion."
Following the transaction, the combined company will have revenues of approximately $3.2 billion. Noveon will become a wholly owned subsidiary of Lubrizol with its headquarters remaining in Brecksville, Ohio. The new Noveon subsidiary will include Lubrizol's fluid technologies for industries businesses and will have annualized sales of approximately $1.6 billion.
"Noveon is a well-run company," said Lubrizol's president, James L. Hambrick, who will succeed W.G. Bares as CEO at the company's April 26 annual meeting of shareholders. "It holds leading positions in a number of high-growth markets and will give us the added breadth we need to leverage our technology into new markets and applications. Our business will be better balanced following the acquisition. Approximately one-half of our company will consist of Lubrizol's traditional business, which concentrates on lubricant additives for the transportation market and is a strong, stable and cash-generating business. The other half will concentrate on the higher-growth areas of industrial and consumer-related products. Once the transaction is completed, we will move rapidly to integrate the acquisition and achieve synergies resulting from the combination of the two organizations."
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