Advent acquires Evonik's methacrylates business for €3bn

The enterprise value of the business was 8.5x EBITDA, which was €350m on average between 2016-2018.

Throughout the process, valuation levels had been around €2bn, according to Unquote sister publication Mergermarket. Evonik initially marketed the assets at an EBITDA of €400m expecting to sell for 6x EBITDA. The figure was lowered to €336m for 2019 due to market conditions.

Evonik began examining strategic options for the business in March 2018. The final phase of the sale process saw bids from Advent, SK Capital, trade buyer Ineos and a consortium of Rhone Capital and Triton, according to Mergermarket.

GSO offered final bidders a unitranche of €1.5bn and Barclays offered an all-loan structure of €1.25bn, according to Debtwire.

Advent closed its Advent International GPE VIII fund on $13bn in 2016. Advent stated the fund will pursue the same strategy as its predecessor, which targeted companies with an enterprise value of up to $3.5bn and wrote equity tickets of between $100m-1bn. The fund was 65% deployed as of September 2018.

Advent will work with the management team that is already in place. The firm plans to invest in employees, technology and production sites, and expand and invest to strengthen the company's market position.

The transaction is subject to regulatory approval and is expected to close in the third quarter of 2019.

Company
Evonik is based in Essen, Germany. Evonik has sold its Acrylic Products, CyPlus and methacrylate business lines. Its products are used in paints and coatings, and the construction, automotive and healthcare sectors.

The business employs 3,900 employees across 18 production sites in Germany, North America and Asia. It generated sales of about €2bn in 2018.

People
Advent International – Ronald Ayles (managing partner, global head of chemicals).

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