Lone Star to exit MBCC in EUR 5.2bn deal

The enterprise value represents a 11.5x pro forma 2022 EBITDA multiple; expected annual synergies of CHF 160m-180m would bring the multiple down to 8.5x EBITDA, Sika said in a statement.

The planned transaction will initially be financed by a bridge loan facility. Sika said it would put in place a long-term funding structure comprising a combination of cash-on-hand, bank loans and capital markets instruments.

The acquisition is subject to regulatory approval, with closing targeted for the second half of 2022.

Sika said the purchase would expand its product and service offering in construction chemicals and industrial adhesives by adding the complementary portfolio of MBCC, with the combined group set to reach sales in excess of CHF 13bn in 2023.

Previous funding
Lone Star agreed to acquire the construction chemicals business of listed business BASF, a Germany-headquartered chemicals group, in late 2019. The purchase price amounted to EUR 3.17bn, with the transaction closing in 2020.

Bidders in the second round of the auction process in 2019 included Lone Star, Cinven, KKR, Bain Capital and Advent International. Blackstone and Switzerland-based cement producer LafargeHolcim left the process in July and October 2019 respectively.

The total debt package stood at EUR 1.45bn, according to Unquote Data. Out of this, EUR 700m's worth of senior debt funding was provided by GSO Capital Partners.

Company
MBCC, headquartered in Mannheim, Germany, is active in the field of construction chemicals and admixture systems. With approximately 7,500 employees, it has operations in 60 countries and operates 130 production facilities.

In 2021, the company is expected to generate net sales of CHF 2.9bn.

People
MBCC Group – Jochen Fabritius (CEO).

Advisers
Vendor – Kirkland & Ellis (legal).

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