Huntsman (HUN) To Acquire Icynene-Lapolla For $350 Million
Zacks Investment Research | Dec 09, 2019 08:38PM ET
Huntsman Corporation (NYSE:HUN) announced deal to buy Icynene-Lapolla from an affiliate of FFL Partners, LLC. Notably, Icynene-Lapolla is a leading North American manufacturer and distributor of spray polyurethane foam (SPF) for commercial and residential use. It has annual revenues of around $230 million, with two manufacturing facilities in Houston, TX, and Mississauga, Ontario.
The acquisition is expected to expand Huntsman’s downstream footprint in SPF insulation.
Per the terms of the deal, the company is expected to pay $350 million in the all-cash transaction financed from available liquidity, subject to customary closing adjustments.
Based on 2019 adjusted EBITDA forecast, the purchase price suggests an adjusted EBITDA multiple of 10 times or adjusted EBITDA pro forma of 7 times for synergies. The transaction is slated to close in the first half of 2020.
Per Huntsman’s management, the combination of Icynene-Lapolla (with its SPF product range and reflective roof coatings), with Demilec (acquired by Huntsman in 2018) is expected to significantly strengthen its energy-saving insulation business and provide customers with an unparalleled choice offering. The combination will also provide Huntsman with the world’s largest range of spray foam technology, integration of raw materials and associates.
Huntsman's shares have gained 21.8% in the past year against the Zacks Investment Research
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