TAGS: Epoxy Coatings Sustainability / Natural Coatings
Hexion Holdings Corporation has announced its plan to separate into two independent companies. The two companies will be “Hexion Coatings and Composites (US) Inc.” (“HCC”), composed of Hexion Holdings’ former epoxy-based Coatings and Composites products, and “Hexion Holdings,” composed of the Company’s Adhesives and Versatic Acids™ and Derivatives product lines. HCC will be renamed later.
Strategic Focus to Serve Customers’ Needs
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With our recent strong performance, and after a comprehensive evaluation of strategic actions aimed at unlocking the value of our businesses, our Board and management team have determined that now is the right time to pursue a separation through an IPO and spinoff. The transaction will provide each company with significant liquidity, a sharper strategic focus and appropriately capitalized balance sheets while we continue to serve our customers’ needs”, said Craig Rogerson, Hexion chairman, president and chief executive officer.
The Company believes that this separation will result in material benefits to the standalone companies, including:
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Distinct strategic and management focus on specific operational, R&D and growth priorities, including the analysis of macroeconomic trends and the implementation of financial targets that best fit each business
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A capital structure, dividend policy and capital deployment strategy tailored to specific business models and growth strategies. Both businesses are expected to have direct access to the debt and equity capital markets to fund their respective growth strategies
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An investor base that is aligned with the streamlined value proposition for each company
Growing Demand for Ecofriendly Building and Coatings Materials
Following the separation, Hexion Holdings will consist of the Company’s existing Adhesives and Versatic Acids™ and Derivatives product lines. Hexion Holdings will continue to build on its strong momentum, driven primarily by strong new residential construction and remodeling demand in North America, continued capacity expansion progress and gains from innovative new products, as well as the need for more sustainable building and coatings materials.
HCC to Expand Leadership and Global Presence
HCC will consist of Hexion Holdings’ former base and specialty epoxy resins product lines. HCC will remain one of the leading global suppliers of epoxy resins and systems.
As a standalone company, HCC will have greater ability to grow and expand its leadership position in attractive global markets. Importantly, HCC is also focused on addressing customers’ demands for more environmentally preferred solutions and providing innovative solutions for the wind energy and automotive industries.
Source: Hexion