Carlyle Group to Buy DuPont Coatings Business for $4.9B
Global alternative asset manager The Carlyle Group and DuPont announced that they have signed a definitive agreement whereby Carlyle will purchase DuPont Performance Coatings for $4.9 billion in cash. The transaction is expected to close in the first quarter 2013, subject to customary closing conditions and regulatory approvals.
Global alternative asset manager The Carlyle Group and DuPont today announced that they have signed a definitive agreement whereby Carlyle will purchase DuPont Performance Coatings for $4.9 billion in cash. The transaction is expected to close in the first quarter 2013, subject to customary closing conditions and regulatory approvals.
DPC is a global supplier of vehicle and industrial coating systems with 2012 expected sales of more than $4 billion and more than 11,000 employees. The investment will be funded with equity from Carlyle Partners V and Carlyle Europe Partners III.
"DuPont Performance Coatings is a leader in the automotive and industrial coatings sectors with world-class products and customer service. The business continues to grow and deliver solid results. After a careful review, however, we have determined that DPC's full growth potential would be best realized outside DuPont and through the sale to Carlyle," said DuPont Chair and CEO Ellen Kullman. "This transaction is consistent with our vision to be the world's most dynamic science company and long-term strategy of driving competitive advantages in agriculture and nutrition, advanced materials and biotechnology, which represent high-growth, high-margin opportunities."
Greg Ledford, Carlyle Managing Director and Head of the Industrial and Transportation team, said, "DuPont Performance Coatings is a successful business with attractive market positions, next-generation technology and established brands. Through targeted investments we will support DPC's product development and growth objectives as it transitions to a stand-alone company. We look forward to working with management to fully realize DPC's great potential."
Gregor Böhm, Managing Director and Co-head of Carlyle's Europe Buyout team, said, "DuPont Performance Coatings is a technology innovator and we look forward to building on its strong market presence to accelerate growth in emerging markets, particularly in China and Brazil."
Kullman stressed that DuPont remains committed to serving the automotive industry. Following the closing of this transaction, DuPont will generate more than $3 billion in sales of advanced materials to the auto industry. "We will continue to work closely with automotive customers to apply our science-powered innovations related to light weighting of vehicles, revolutionary and environmentally friendly refrigerants, biobased seat fabrics and headliners, and next-generation biofuels," Kullman said.
Beginning with the third quarter 2012, DuPont will classify and report results of DPC as discontinued operations on a retroactive basis. DuPont expects 2012 full-year earnings from discontinued operations to be in the range of $.41 to $.47 per share. Full-year 2012 guidance was last updated on and as of July 24, 2012, and is not being updated today. The company will begin providing full-year 2012 guidance from continuing operations when it issues its third quarter earnings announcement on Oct. 23.
DuPont plans to eliminate general corporate overhead costs that were previously allocated to DPC but are not part of the transaction. Additional details will be provided during DuPont's third quarter earnings announcement. As part of the transaction, Carlyle will assume $250 million of DuPont's unfunded pension liabilities. DuPont will use the net after-tax proceeds of this sale in a manner consistent with its cash deployment principles and goal to maximize shareholder value creation.
Carlyle's industrial and automotive investments include Allison Transmission, Hertz and PQ Corporation, as well as recent commitments to invest in Hamilton Sundstrand Industrial, Sunoco's Philadelphia refinery and regional rail freight operator Genesee & Wyoming.
Related Content
Trends in Industrial Coatings
The benefits of new technologies in the industrial coatings market.
Read MoreSolving Paint Adhesion Problems
A farm equipment supplier’s quest to find the right cleaning chemistry.
Read MoreMasking Solutions Provider CFS Dramatically Expands Capabilities and Capacity
Custom Fabrication & Supplies (CFS) completed a new plant expansion packing 10 times the capacity into twice the space. It dramatically enhances the supplier’s custom capabilities to provide extremely precise and cost-effective masking solutions.
Read MoreCuring Oven Basics
Simply heating up the substrate does not cure the coating. There are many variables to consider when choosing the best cure oven for your application...
Read MoreRead Next
Episode 42: An Interview with Robin Deal, Hubbard-Hall
Hubbard-Hall wastewater treatment specialist Robin Deal discusses the latest trends in wastewater management.
Read MoreThe 2024 Ford Mustang: All the Colors Available
Although Chevrolet has announced the end of the Camaro and Dodge is offering “Last Call” editions of the Charger and Challenger, the Ford Mustang is launching to its seventh generation.
Read MorePowder Coating 4.0: Smarter, Faster, More Efficient and Connected
New tools reduce cost and waste, lower manufacturing footprint of powder coating operations.
Read More