Covestro acquires the Resins & Functional Materials businesses (RFM) from Royal DSM to expand revenues of the Coatings, Adhesives, Specialties (CAS) segment. The acquisition has an equity value of 1.6 billion euro. The integration will expand the company’s revenues by more than 40 percent to about EUR 3.4 billion (2019 pro-forma).
Drive Innovation Towards Circular Economy
The transaction will include all of DSM’s RFM businesses, including DSM Niaga
®, a reversible, VOC and solvent-free and non-toxic adhesive and a proprietary production technology for fully recyclable carpets, mattresses and furniture components, DSM Additive Manufacturing and the coatings activities of DSM Advanced Solar.
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This acquisition is an important step for our corporate strategy. RFM enhances the growth trajectory of our business. By combining our strong innovation capabilities, sustainable product portfolios as well as complementary technologies and customer industries, we will unlock significant value. At the same time, it is also a key step to drive innovation for the transition towards a circular economy,” said Dr. Markus Steilemann, chief executive officer of Covestro.
Enhancing Technological Capabilities
The integration of RFM will create a business of enhanced scale and technological capability, benefitting customers and employees through a stronger growth platform. Covestro is one of the leading providers of water-based polyurethane dispersions. With the acquisition of RFM, the company will add a complete range of water-based polyacrylate resins and will expand its technology portfolio to include water-based hybrid technologies and radiation curing resins.
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The acquisition is strategically and financially a perfect opportunity for us to pursue our long-term growth strategy at highly attractive conditions and tangible synergies. With the chosen financing structure, we are striking the right balance between equity and debt,” said Dr. Thomas Toepfer, Covestro’s chief financial officer and Labor Director.
Closing of the transaction is expected for the first quarter of 2021 and is subject to regulatory approvals, including antitrust clearance.
Source: Covestro