ashland-hercules

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Ashland to acquire Hercules
　　$3.3 billion transaction creates major, global specialty chemicals company

Ashland Inc. and Hercules Inc. today announced that they have entered into a definitive merger agreement under which Ashland would acquire all of the outstanding shares of Hercules for $18.60 per share in cash and 0.093 of a share of Ashland common stock for each share of Hercules common stock. The total transaction value is approximately $3.3 billion, or $23.01 per Hercules share based on Ashland’s July 10 closing stock price and including $0.7 billion of net assumed debt. The transaction, which would create a major, global specialty chemicals company, is expected to close by the end of calendar 2008.

With sales in more than 100 countries, Ashland is a manufacturer of specialty chemicals, a leading distributor of chemicals and plastics, and a provider of automotive lubricants, car-care products and quick-lube services. Hercules is a leader in specialty additives and ingredients that modify the physical properties of water-based systems and is one of the world’s leading suppliers of specialty chemicals to the pulp and paper industry.

Ashland Chairman and Chief Executive Officer James J. O’Brien said, “The acquisition of Hercules fulfills our objective to become a leading specialty chemicals company. It creates a defined core for Ashland composed of three specialty chemical businesses with strong market positions and promising global growth potential: specialty additives and ingredients, paper and water technologies, and specialty resins. In addition, we expect our financial profile to be enhanced significantly through reduced earnings volatility, improved profitability and stronger cash flow generation.”

In specialty additives and ingredients, Hercules' Aqualon business is one of the most recognized and admired specialty chemical brands in the world and brings Ashland a significant market position in rheology modifiers, which alter the physical properties of water-based systems. These additives are used across a wide range of industries to make everything from adhesives and paints to foods, pharmaceuticals and personal care products. Nearly all of Aqualon’s additive products are water soluble polymers derived from renewable materials. The combined company generates, on a pro forma basis, approximately one-third of EBITDA from bio-based or renewable chemistries.

“We will combine the paper and water businesses of each company to create one global paper and water technologies business with annual revenue of $2 billion,” said O’Brien. “In particular, Hercules’ leadership position in pulp and paper technologies bolsters our participation in one of the world’s largest water treatment markets. The combined businesses will provide the scale to leverage opportunities in other key water treatment markets including municipal, industrial and marine.

“The third business within our new core - specialty resins - is one where Ashland has long enjoyed a strong reputation for innovation and service. A broader international footprint will offer the specialty resins business expanded global growth opportunities in key building and construction markets, including infrastructure and wind energy. In addition, our Distribution and Valvoline businesses provide complementary capabilities and share similar markets with the specialty chemical businesses,” said O’Brien.

Ashland to acquire International Specialty Products Inc. (ISP); broadens global leadership in specialty chemicals

アシュランド社（Ashland Inc.、NYSE: ASH）とインターナショナル・スペシャルティ・プロダクツ社（International Specialty Products Inc.、ISP）は３日、アシュランドが革新的な機能性原料と技術を保有する世界的な特殊化学製品メーカーである非上場企業のISPを買収することで合意したと発表した。株式購入合意によると、アシュランドはISP事業に対して約３２億ドルを全額現金で支払う。合意が完了すれば、ISPの最先端製品ポートフォリオは、個人医療、製薬、エネルギーなどの高成長市場におけるアシュランドの地位を拡大する。ISPは３月３１日締めの過去１年間で、約１６億ドルの売り上げと、支払利息・税金・減価償却・償却控除前利益（EBITDA）で約３億６０００万ドルの収益があった。今回の取引はアシュランドの１株当たり利益（EPS）を直ちに増やす見通しである。

ISPは消費者および生産市場向けの特殊化学製品とパフォーマンス向上製品の有力な世界的サプライヤーである。ISPは他社にない製品を通じて、アシュランドの機能性原料ビジネスとともにアシュランドの食品・飲料、エネルギー、コーティング、固着剤、水処理の市場を補完する添加剤に高価値な水溶性ポリマーやその他最先端技術をもたらす。買収によって、アシュランドの機能性原料の有効特許ポートフォリオと同社研究開発の科学者チームが大幅に強化されると期待されており、その結果、顧客が抱える製剤上の課題を解決する技術および応用能力を備えた世界的機能性原料ビジネスがより強化されることになる。

アシュランド社のジェームス・J・オブライエン会長兼最高経営責任者（CEO）は「今回の特徴的な取引によって、当社は個人医療や製薬などの高利益率かつ高成長で、景気循環の影響を受けにくい世界市場における当社の市場ポジションを大幅に拡大することができる。この取引によって、アシュランドは５０億ドル以上のパーソナルケア向け機能性原料製品市場の大規模で急成長するセグメントであるスキン、ヘア、オーラルのケアなど魅力的な成長分野でプレゼンスが広げることになる。さらに、われわれは当社の最も利益率の高い機能性原料ビジネスの規模を２倍以上にすることを期待している」と語った。

ISPのスニル・クマール社長兼CEOは「われわれはISPがアシュランドと合併できる機会を大変喜んでいる。両社は革新的なソリューションと技術で顧客にサービス提供することに全力を注いでいる。われわれはこのビジネスに対するアシュランドの情熱を高く評価するとともに、この合併が当社の顧客、主要ビジネス・パートナー、雇員にとって多大な可能性をもたらすと確信している」と語った。

オブライエン会長はまた「われわれはISPの雇員をアシュランドに喜んで迎える。われわれのビジネスモデルは補完的であり、製剤、応用業務開発、ポリメリゼーションにおける共通の能力を相互に保有している。われわれはクラス最高の製品の製造を実現する基礎的なプロセスとオペレーションをしっかりと身につけている。両社のリーダーシップの質、買収前の統合の成功を考慮すれば、われわれは統合された企業へのスムーズな移行を達成できると確信している。われわれは前途に横たわる革新性と成長の機会に気持ちが高ぶっている」と語った。

ISPは1942年、IG Ferbenから独立したGeneral Aniline & Filma(GAF)社の化学品部門として創業しました。以後、スペシャリティケミカル分野のメーカーとして独自のスタンスを確立。研究開発・製造販売からサービスにいたるマーケティングをグローバルな規模で展開し、世界中から高い信頼と評価を獲得してきました。

現在では米国に９工場、ドイツに１工場を擁し、さらにベルギーに新工場の整備を計画中。これらの生産拠点で生み出される特殊化学品は実に３００アイテム以上。そのすべてが、世界７０カ国を越える営業拠点から９０カ国に展開するISP販売ネットを通じて、お客様に提供され、スキンケア・ヘアケア、医療、飲料、コーティング・洗浄剤・エンプラ原料などの多岐にわたって採用されています。

Ashland Inc. and International Specialty Products Inc. (ISP) today announced that Ashland has agreed to acquire privately owned ISP, a global specialty chemical manufacturer of innovative functional ingredients and technologies. Under the terms of the stock purchase agreement, Ashland will pay approximately $3.2 billion for the business in an all-cash transaction. At closing, ISP’s advanced product portfolio will expand Ashland’s position in high-growth markets such as personal care, pharmaceutical and energy. For the 12 months ended March 31, 2011, ISP generated sales of approximately $1.6 billion and earnings before interest, taxes, depreciation and amortization (EBITDA) of approximately $360 million. The transaction is expected to be immediately accretive to Ashland’s earnings per share.

ISP is a leading global supplier of specialty chemicals and performance enhancing products for consumer and industrial markets. Through its unique offerings, ISP will bring high-value water soluble polymers and other advanced technologies into Ashland’s functional ingredients business, as well as complementary additives for Ashland’s food and beverage, energy, coatings, adhesives and water treatment markets. The acquisition is expected to significantly strengthen Ashland’s functional ingredients active patent portfolio and its team of research and development scientists. The result will be a stronger, global functional ingredients business with proven technological and application capabilities to solve customers’ unique formulation challenges.

Ashland Chairman and Chief Executive Officer James J. O’Brien said, “This defining transaction enables us to significantly expand our market positions in higher margin, higher growth and less cyclical global markets like personal care and pharmaceuticals. It broadens Ashland’s presence within attractive growth areas like skin, hair and oral care, which are large and fast-growing segments of the $5-billion-plus personal care specialty ingredients market. In addition, we expect to more than double the size of our highest-margin functional ingredients business.”

ISP President and Chief Executive Officer Sunil Kumar said, “We are very enthusiastic about the opportunity to combine ISP with Ashland. Both companies have a strong commitment to serving customers with innovative solutions and technologies. We appreciate Ashland’s passion for this business and we believe this combination offers tremendous potential for our customers, key business partners and employees.”

O’Brien added, “We look forward to welcoming ISP’s employees to Ashland. Our business models are complementary and we share common capabilities in formulation, application development and polymerization. We are disciplined in the underlying processes and operations that enable us to manufacture best-in-class products. Given the quality of leadership within both businesses and our success with the integration of prior acquisitions, we are confident we will achieve a smooth transition to a combined company. We are excited about the opportunities for innovation and growth that lie ahead of us.”

Transaction Details
On a pro forma basis giving effect to the transaction, Ashland would have had combined revenue for the 12 months ended March 31, 2011, of approximately $7.6 billion, with nearly half of revenues generated outside North America. The newly combined functional ingredients business is expected to contribute roughly half of Ashland’s $1.1-billion pro forma EBITDA.

Ashland expects to realize annualized run-rate cost savings of approximately $50 million by the second year following the transaction’s close through eliminating redundancies and capturing operational efficiencies.

The transaction, which is expected to close prior to the end of the September quarter, is subject to satisfaction of customary closing conditions and receipt of U.S. and European Union regulatory approvals. The purchase price will be subject to post-closing adjustments for changes in net working capital and certain other items. The transaction will be funded through a combination of cash on hand and committed financing from Citi, The Bank of Nova Scotia, BofA Merrill Lynch and U.S. Bank National Association, subject to customary terms and conditions.

Under the terms of the stock purchase agreement, if the financing is not available and the other conditions to closing are satisfied, ISP has the right to terminate the agreement and require Ashland to pay a fee of $413 million.

BofA Merrill Lynch acted as financial advisor, and Cravath, Swaine & Moore LLP acted as legal counsel, to Ashland. Moelis & Company acted as financial advisor, and Sullivan and Cromwell LLP acted as legal counsel, to ISP.

About Ashland Inc.
In more than 100 countries, the people of Ashland Inc. provide the specialty chemicals, technologies and insights to help customers create new and improved products for today and sustainable solutions for tomorrow. Our chemistry is at work every day in a wide variety of markets and applications, including architectural coatings, automotive, construction, energy, personal care, pharmaceutical, tissue and towel, and water treatment. Visit www.ashland.com to see the innovations we offer through our four commercial units - Ashland Aqualon Functional Ingredients, Ashland Hercules Water Technologies, Ashland Performance Materials and Ashland Consumer Markets (Valvoline).

About International Specialty Products Inc.
International Specialty Products Inc. (ISP) is a leading global supplier of specialty chemicals and performance-enhancing products for a wide variety of consumer and industrial markets including personal care, pharmaceuticals, beverage, home care, coatings & adhesives, energy, agriculture, plastics, tires and others. Through its network of manufacturing sites, ISP produces more than 500 specialty chemicals, which it markets and sells worldwide. ISP has more that 275 scientists worldwide including global research centers in Wayne, New Jersey; Sofia Antipolis, France; Bradford, UK; Hyderabad, India and Shanghai, China. The company's headquarters is located in Wayne, New Jersey, USA.

Use of Non-GAAP Measures
This news release includes certain non-GAAP (generally accepted accounting principles in the U.S.) and pro forma measures. Such measurements are not prepared in accordance with GAAP and should not be construed as an alternative to reported results determined in accordance with GAAP. Management believes the use of such non-GAAP and pro forma measures assists investors in understanding the ongoing operating performance of the combined company and its segments. The non-GAAP and pro forma information provided may not be consistent with the methodologies used by other companies. All non-GAAP amounts for Ashland have been previously reconciled with reported GAAP results.

Ashland Global Holdings Inc. today announced it has signed a definitive agreement to sell its Composites business and the butanediol (BDO) manufacturing facility in Marl, Germany, to INEOS Enterprises in a transaction valued at approximately $1.1 billion. The transaction is expected to close prior to the end of the June 2019 quarter, contingent on certain customary regulatory approvals, standard closing conditions and completion of required employee information and consultation processes.

Ashland expects net proceeds from the sale to total approximately $1 billion and anticipates that proceeds primarily will be used for debt reduction.

Prior to reporting its financial results for the first quarter of fiscal 2019, Ashland plans to update its outlook for both the first quarter and for the full 2019 fiscal year to reflect the impact of moving these businesses to discontinued operations.

Ashland's Composites unit is a global leader in unsaturated polyester resins, vinyl ester resins and gel coats, while the BDO facility in Germany and related merchant products included in the agreement are part of Ashland's Intermediates and Solvents (I&S) segment. Ashland's Composites and Marl BDO facility have combined sales of more than $1.1 billion per year and approximately 1,300 employees. Ashland will retain its BDO plant in Lima, Ohio, to ensure consistent supply for the company's internal needs.

"Composites and Marl are outstanding businesses with strong market positions and high-performing teams," said Bill Wulfsohn, Ashland chairman and chief executive officer. "At the same time, the divestiture of these businesses is consistent with Ashland's vision of becoming the premier specialty chemicals company. With a more streamlined and focused product portfolio, improved margins and reduced earnings volatility, Ashland will be better positioned to deliver sustained earnings growth and unlock significant value for shareholders. Over the past two years, we have taken specific actions to sustain and grow Ashland's premium mix while also improving our competitiveness, particularly within Specialty Ingredients. These actions are driving strong earnings growth, as evident in our fiscal 2018 financial results."

Privately owned INEOS is one of the world's largest manufacturers of chemicals and oil products, with annual sales of $60 billion and approximately 20,000 employees. The London-based company operates 171 sites in 24 countries.

"We believe that the Ashland Composites business will have great potential for growth under INEOS ownership and we are looking forward to working with a great team of people who are determined to meet the developing needs of our customers," said Ashley Reed, CEO, INEOS Enterprises.

Citi is acting as financial advisor to Ashland, and Squire Patton Boggs LLP is acting as legal advisor.

About Ashland
Ashland Global Holdings Inc. is a premier global specialty chemicals company serving customers in a wide range of consumer and industrial markets, including adhesives, architectural coatings, automotive, construction, energy, food and beverage, nutraceuticals, personal care and pharmaceutical. At Ashland, we are approximately 6,000 passionate, tenacious solvers - from renowned scientists and research chemists to talented engineers and plant operators - who thrive on developing practical, innovative and elegant solutions to complex problems for customers in more than 100 countries.