A. Schulman has agreed to purchase a majority of the assets
of the specialty plastics business of Ferro Corp. for $91
million in cash, the companies announced on Wednesday.
The purchase agreement includes four facilities
located in the US as
well as operations in Spain.
Subject to the satisfaction of customary closing conditions
and regulatory approvals, the transaction is anticipated to
close during the fourth quarter of A. Schulman's current
fiscal year ending August 31, 2014.
Excluded from the transaction are Ferro's plastics business
and operations in Edison, New Jersey, and Carabobo,
The acquisition is expected to be accretive to adjusted
earnings per share, and Schulman anticipates achieving
approximately $5.5 million in synergies within 12 to 18
months following the close of the transaction, driven
primarily by sourcing activities and plant efficiency
The assets included in the pending transaction achieved sales
of $154 million in 2013, with approximately two-thirds of
these revenues generated in the US. As a result, this
acquisition is expected to deliver important geographic
diversification benefits to A. Schulman.
The specialty plastics segment is a global supplier of custom
engineered plastic compounds, colorants, and liquid coatings,
primarily focused on thermoset plastic technology
. The business offers a
broad portfolio of proprietary products and recognized brand
names serving a wide range of end markets including
packaging, transportation, construction
, appliances and
"We continue to strengthen our US operations and expand our
global capabilities in engineered plastics, masterbatch
solutions and custom performance colors, which represent
outstanding profitable growth opportunities and are integral
to our value creation strategy," said Bernard Rzepka, chief
operating officer of A Schulman.