Solvay and Rhodia announce the signing of a framework agreement according to which Solvay will launch a friendly cash Offer for 100 % of the share capital of Rhodia. The cash Offer at EUR 31.60 per share (ex dividend of EUR 0.5 per share) values the equity of Rhodia at EUR 3.4 billion and the enterprise value at EUR 6.6 billion, representing a REBITDA multiple of 7.3x . The Offer represents a premium of 50% compared to the closing price of Rhodia on the 1st of April 2011 and a premium of 44 % compared to the average closing share price over the last three months. The Offer will be launched in France and extended to the United States of America. The transaction has been recommended unanimously by the board of directors of Rhodia.
The acquisition of Rhodia will be earnings accretive from the first year. Solvay will fully finance the transaction with its cash resources and its financial structure will continue to be conservative and solid.
The creation of a new group will accelerate the shared ambition to create a large global chemical company committed to sustainable development.
The new group’s strategy is based on the following strengths:
90 % of its combined sales of EUR 12 billion are realized in businesses where it is already among the top three worldwide. Solvay is a leader in high performance specialty polymers, in soda ash and hydrogen peroxide, while Rhodia holds leadership positions in specialty materials (silica, rare earths), products for consumer markets (surfactants, natural polymers, acetate tow) and engineering plastics based on polyamide 6.6.
Future geographic expansion will be driven by a significant presence in the emerging markets, which already generate 40 % of sales of the combined group. The complementary nature of the industrial activities of Rhodia and Solvay should provide the combined group with a balanced presence in its different market segments: specialty chemicals for consumer goods, construction, automotive, energy, water, environment, and electronics.
To facilitate a smooth and rapid integration of the two groups, Jean-Pierre Clamadieu, Chairman and CEO of Rhodia, will join Solvay’s Executive Committee in the role of Deputy CEO once the Offer is closed. Jean-Pierre Clamadieu is also intended to succeed Solvay’s current CEO Christian Jourquin upon his retirement. In this context Jean-Pierre Clamadieu will be proposed for appointment to the board of directors of Solvay at the AGM in May 2012. In addition, Gilles Auffret, COO of Rhodia, will be appointed CEO of Rhodia and member of the Executive Committee of Solvay.
A tender Offer conditional upon the approval by E.U. and U.S. anti-trust authorities and upon a minimum acceptance level of 50 % plus one share will be filed in the coming days. Solvay expects that the Offer will be closed by late August 2011. Upon reaching a 95 % acceptance level Solvay reserves the right to conduct a squeeze-out of the remaining shares. Bonds convertible into and / or exchangeable into new or existing shares (OCEANE) issued by Rhodia will also be offered a price of EUR 52.3 per OCEANE.
- Solvey, Brussels, Belgium