A. Schulman Announces an Agreement in Principle to Acquire Network Polymers, a Leading North American Niche Engineered Plastics Producer
AKRON, Ohio, May 28, 2013 /PRNewswire/ --
- Strengthens Company's U.S. business position
- Provides complementary specialty business in ABS and ASA engineered plastics
- Expands U.S. distribution business
A. Schulman, Inc. (Nasdaq-GS: SHLM) announced today that it has reached an agreement in principle to purchase Network Polymers, Inc., a U.S. niche engineered plastics compounding and distribution business, for approximately $50 million, subject to completion of due diligence. The transaction is anticipated to close within the next few months.
"We have demonstrated a strong commitment at A. Schulman to grow through opportunistic and strategic acquisitions as well as organic growth. Network Polymers is an excellent fit with our ongoing strategy as we continue to enhance our niche engineered plastics business in the U.S.," said Joseph M. Gingo, Chairman, President and Chief Executive Officer, A. Schulman. "Network Polymers will provide greater penetration in key markets such as building and construction, agricultural products, and lawn and garden. It also brings strong technical expertise and a seasoned sales force that will help to leverage existing A. Schulman products and expertise to a wider customer base. In addition, the combination will expand our distribution business in the U.S."
"The highly talented teams at both Network Polymers and A. Schulman share a passion for providing custom formulations that meet the most demanding customer needs and applications," said Alan Woll, Chief Executive Officer, Network Polymers, Inc. "Our organizations have complementary products and technologies, and we expect our similar cultures to fit together well; therefore, we believe this is an exciting opportunity to become part of A. Schulman's global organization."
Network Polymers is a leading single source provider of thermoplastic resins and alloys. The company offers a broad spectrum of custom resins and alloys to meet customer-specific product design and manufacturing requirements. Network Polymers is also the exclusive producer of the Centrex® ASA family of products as well as the Diamond Polymer brand of ABS, ABS/PC, ASA and ASA/PC thermoplastic products. The company operates a 72,000-square-foot manufacturing facility in Akron, Ohio, and employs approximately 70 people. It recorded revenues of $65.3 million in fiscal 2012.
Gingo added, "We continue to search for strategic acquisitions in the specialty plastics space, and while we are still interested in entering into a mutual dialogue and due diligence with Ferro Corporation, we will continue with our aggressive bolt-on acquisition strategy in our specialty plastics business as well as exploring other opportunities for transformational acquisitions. To date, we have successfully executed five acquisitions and two joint ventures in less than four years. We are encouraged by the near-term opportunities in the potential global acquisition pipeline and are actively pursuing other targets that align with our value creation strategy."
About A. Schulman, Inc.
A. Schulman, Inc. is a leading international supplier of high-performance plastic compounds and resins headquartered in Akron, Ohio. Since 1928, the Company has been providing innovative solutions to meet its customers' demanding requirements. The Company's customers span a wide range of markets such as packaging, mobility, building & construction, electronics & electrical, agriculture, personal care & hygiene, sports & leisure, custom services and others. The Company employs approximately 3,300 people and has 35 manufacturing facilities globally. A. Schulman reported net sales of $2.1 billion for the fiscal year ended August 31, 2012. Additional information about A. Schulman can be found at www.aschulman.com.
Cautionary Note on Forward-Looking Statements
A number of the matters discussed in this document that are not historical or current facts deal with potential future circumstances and developments and may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they do not relate strictly to historic or current facts and relate to future events and expectations. Forward-looking statements contain such words as "anticipate," "estimate," "expect," "project," "intend," "plan," "believe," and other words and terms of similar meaning in connection with any discussion of future operating or financial performance. Forward-looking statements are based on management's current expectations and include known and unknown risks, uncertainties and other factors, many of which management is unable to predict or control, that may cause actual results, performance or achievements to differ materially from those expressed or implied in the forward-looking statements. Important factors that could cause actual results to differ materially from those suggested by these forward-looking statements, and that could adversely affect the Company's future financial performance, include, but are not limited to, the following:
- worldwide and regional economic, business and political conditions, including continuing economic uncertainties in some or all of the Company's major product markets or countries where the Company has operations;
- the effectiveness of the Company's efforts to improve operating margins through sales growth, price increases, productivity gains, and improved purchasing techniques;
- competitive factors, including intense price competition;
- fluctuations in the value of currencies in major areas where the Company operates;
- volatility of prices and availability of the supply of energy and raw materials that are critical to the manufacture of the Company's products, particularly plastic resins derived from oil and natural gas;
- changes in customer demand and requirements;
- effectiveness of the Company to achieve the level of cost savings, productivity improvements, growth and other benefits anticipated from acquisitions, joint ventures and restructuring initiatives, including any proposed combination with Ferro Corporation;
- escalation in the cost of providing employee health care;
- uncertainties regarding the resolution of pending and future litigation and other claims;
- the performance of the global automotive market; and
- further adverse changes in economic or industry conditions, including global supply and demand conditions and prices for products.
The risks and uncertainties identified above are not the only risks the Company faces. Additional risk factors that could affect the Company's performance are set forth in the Company's Annual Report on Form 10-K for the fiscal year ended August 31, 2012. In addition, risks and uncertainties not presently known to the Company or that it believes to be immaterial also may adversely affect the Company. Should any known or unknown risks or uncertainties develop into actual events, or underlying assumptions prove inaccurate, these developments could have material adverse effects on the Company's business, financial condition and results of operations.
SOURCE A. Schulman, Inc.