On 5 February 2015, W. R. Grace & Co. announced that its Board of Directors had approved a plan to separate into two independent, publicly traded companies – currently referred to as New Grace and New GCP.
New GCP will include Grace’s Construction Products business segment and the Darex packaging business. The company expects New GCP to retain a leading position in the cement and concrete chemicals market, specialty building materials and can sealants and coatings. Post-separation sales are forecast at around US$1.5 billion. Greg Poling, President and COO of Grace, will serve as President and CEO of New GCP.
New Grace will comprise Grace’s Catalysts Technologies and Materials Technologies business segments. Following separation, New Grace will be led by Fred Festa, Chairman and CEO, and Hudson La Force, Senior Vice President and CFO. Sales of approximately US$1.8 billion are expected post-separation. The company has also stated that it ‘believes that New Grace will seek to make strategic bolt-on acquisitions in its core segments as well as acquisitions to expand its high margin, high-performance specialty chemicals and performance materials portfolio’.
The company believes that the split will provide a number of benefits, namely enhancing strategic focus, creating distinct investment identities, simplifying operating structures and creating strong financial profiles.
The separation transaction is expected to close in around 12 months.
“Grace has created significant shareholder value by focusing on our customers, driving innovation and growth, and executing a disciplined capital allocation strategy,” said Fred Festa, Grace Chairman and Chief Executive Officer. “Our Board and management team continuously evaluate strategic options to create value and, after a comprehensive review, determined that this separation is in the best interest of the company and our shareholders. The time is right to create two strong, independent companies that will benefit from improved strategic focus, simplified operating structures, and more efficient capital allocation.”
“We have a world class team of talented people who have worked hard to transform Grace into a high performing company. Those efforts allow us to take this next important step in our evolution,” added Festa. “We’re confident that both teams will maintain the customer focus and commitment to growth and value creation that have been keys to our success.”
Adapted from press release by Louise Fordham
Read the article online at: https://www.worldcement.com/the-americas/16022015/w-r-grace-to-separate-into-two-companies-343/