Huntsman finalizes sale of India based DIY consumer adhesives business

Huntsman-sold-India-DIY-consumer- adhesives-business

Huntsman Corporation recently announced that it has completed the sale of its India based Do-It-Yourself consumer adhesives business, within its Advanced Materials division, to Pidilite Industries Ltd. in an all-cash transaction.

Huntsman-sold-India-DIY-consumer- adhesives-business

Huntsman received pre-tax proceeds of approximately $257 million on November 3, 2020, excluding working capital and other adjustments.

Taxes on the transaction are estimated to be just under 10 percent.  Under the terms of the agreement Huntsman may receive up to approximately $28 million of additional cash under an earnout within 18 months if the business achieves sales revenue in-line with 2019, for a total value of up to $285 million, excluding working capital and other adjustments.

The total transaction value represents a 2019 adjusted EBITDA multiple of approximately 15 times.

So far, amid COVID-19 Huntsman recorded $57 million of profits or 22 cents per share in third-quarter 2020, up from $41 million or 13 cents in the year-ago quarter. Adjusted earnings per share were 32 cents in the quarter that beat the Zacks Consensus Estimate of 25 cents.

Revenues deteriorated around 10% year over year to $1,510 million. Yet, it exceeded the Zacks Consensus Estimate of $1,466.9 million.

Huntsman is seeing positive drive entering the fourth quarter. The textile chemical solution leader is on track to integrate two downstream purchases completed earlier this year and deliver more than $100 million of targeted annualized savings from its cost-optimization initiative by the end of 2021.

It is also focused on growing its differentiated businesses and boosting shareholder’s value.