Diversey Public Shareholders to Receive
$8.40 Per Share in Cash in “Go Private” Transaction
Combined company will allow for expanded
markets and additional sustainable solutions
Solenis (“Solenis”) and Diversey Holdings, Ltd. (“Diversey” or
the “Company”) (NASDAQ: DSEY) today announced they have entered
into a definitive merger agreement under which Solenis will acquire
Diversey in an all-cash transaction valued at an enterprise value
of approximately $4.6 billion. Upon completion of the merger,
Diversey will become a private company.
Under the terms of the agreement, Diversey shareholders (other
than shareholders affiliated with Bain Capital Private Equity
(“Bain Capital”)) will receive $8.40 per share in cash, which
represents a premium of approximately 41.0% over Diversey’s closing
share price on March 7, 2023, the last full trading day prior to
the transaction announcement, and a premium of approximately 59.0%
over Diversey’s 90-day volume-weighted average price (VWAP). Bain
Capital will receive $7.84 per share in cash and will rollover a
portion of its shares of Diversey into an affiliate of Solenis in
exchange for common and preferred units of such affiliate.
Headquartered in Wilmington, Delaware, Solenis is a leading
manufacturer of specialty chemicals used in water-intensive
industries, which was acquired by Platinum Equity in 2021. Diversey
is a leading provider of hygiene, infection prevention and cleaning
solutions based in Fort Mill, South Carolina.
“The merger presents a unique opportunity to enhance value and
create a more diversified business with increased scale, broader
global reach, and superior customer service capabilities. It will
enable the combined company to grow and provide a number of
attractive cross-selling opportunities, including meeting
increasing customer demand for water management, cleaning and
hygiene solutions,” said Phil Wieland, Chief Executive Officer of
Diversey.
Solenis CEO John Panichella will lead the combined company
following the transition and integration.
“This is a strategic combination of two leading global products,
services, and technologies providers with proven track records of
product innovation who offer truly differentiated solutions to
customers,” said Mr. Panichella. “In combining these two
complementary businesses, we expect to usher in a new and exciting
chapter in our long history of helping customers tackle core
challenges such as water and energy management, partnering on
sustainability issues to work towards a cleaner, safer world, and
reducing environmental impacts. With continued support from
Platinum Equity and now Bain Capital, we are confident that we’ll
maximize the opportunities ahead.”
“This is a merger of two leading businesses that is fully
complementary,” added Eric Foss, Non-Executive Chairman of the
Board of Directors of Diversey. “We believe the transaction creates
significant value realization for our shareholders.”
Transaction Details
Solenis is a portfolio company of Platinum Equity. Bain Capital,
which invested in Diversey in 2017 and subsequently took the
Company public in 2021, is currently the largest shareholder of
Diversey. Under the terms of the transaction, Bain Capital will
contribute approximately 56% of its existing equity into Solenis at
an implied value per Diversey share of $7.84 and will sell its
remaining shares to Solenis for cash at the same price. After
negotiations with a special committee of Diversey’s Board of
Directors composed entirely of independent directors (the “Special
Committee”), Bain Capital agreed to accept less consideration per
share than the consideration to be paid to the other holders of
Diversey’s shares.
Diversey’s Board of Directors formed the Special Committee to
evaluate and negotiate the transaction with the assistance of
independent financial and legal advisors. Following this process,
the Special Committee unanimously determined that the transaction
with Solenis is in the best interests of Diversey and its
shareholders, and, acting upon unanimous recommendation by the
Special Committee, the Diversey Board of Directors unanimously
approved the merger and recommended that Diversey shareholders vote
in favor of the merger. The Special Committee negotiated the terms
of the merger agreement with assistance from its independent
financial and legal advisors.
In connection with the transaction, Solenis has entered into a
support agreement with Bain Capital, pursuant to which Bain Capital
has agreed to vote all of its Diversey shares (which represent
approximately 73% of Diversey’s outstanding shares) in favor of the
transaction, subject to certain terms and conditions set forth
therein. Solenis intends to finance the transaction with a
combination of committed debt and equity financing, including the
contribution by Bain Capital.
The merger is expected to be completed in the second half of
2023, subject to the satisfaction of customary closing conditions,
including approval by Diversey shareholders holding a majority of
the outstanding shares of the Company and receipt of regulatory
approvals. Upon closing of the transaction, Diversey’s ordinary
shares will no longer be listed on any public market.
Fourth Quarter and Full Year 2022 Earnings Conference Call
Update
In light of today’s announcement, Diversey will not host an
earnings conference call or provide financial guidance in
conjunction with its earnings release for the fourth quarter and
full year 2022 financial results. Going forward, Diversey will
issue earnings releases consistent with its current schedule,
including financial results for the fourth quarter and full year
2022, but will suspend hosting earnings conference calls and
webcasts.
Advisors
Evercore is serving as financial advisor to the Special
Committee and Wachtell, Lipton, Rosen & Katz is serving as the
Special Committee’s legal counsel.
J.P. Morgan Securities LLC and Centerview Partners LLC are
serving as financial advisors to Diversey on the transaction.
Kirkland & Ellis LLP is providing legal counsel to Bain Capital
and Diversey.
BofA Securities, Goldman Sachs and Piper Sandler are serving as
financial advisors to Solenis on the transaction. Gibson, Dunn
& Crutcher LLP is providing legal counsel and Willkie Farr
& Gallagher LLP is providing debt financing counsel to Platinum
Equity and Solenis. BofA Securities and Goldman Sachs are leading
the debt financing for the acquisition.
About Diversey
Diversey’s purpose is to go beyond clean to take care of what’s
precious through leading hygiene, infection prevention and cleaning
solutions. We develop and deliver innovative, mission-critical
products, services and technologies that save lives and protect our
environment. Over the course of 100 years, the Diversey brand has
become synonymous with product quality, service and innovation. Our
fully-integrated suite of solutions combines patented chemicals,
dosing and dispensing equipment, cleaning machines, services and
ancillary digital analysis and serves more than 85,000 customers in
over 80 countries via our vast network of approximately 9,000
employees globally.
For additional information about Diversey, please visit
www.Diversey.com or follow us on LinkedIn, Facebook, or Twitter
@Diversey.
About Solenis
Solenis is a leading global producer of specialty chemicals
focused on delivering sustainable solutions for water-intensive
industries, including the pulp, packaging paper and board, tissue
and towel, oil and gas, petroleum refining, chemical processing,
mineral processing, biorefining, power, municipal, and pool and spa
markets. The company’s product portfolio includes a broad array of
water treatment chemistries, process aids and functional additives,
as well as state-of-the-art monitoring and control systems. These
technologies are used by customers to improve operational
efficiencies, enhance product quality, protect plant assets,
minimize environmental impact and maintain healthy water.
Headquartered in Wilmington, Delaware, the company has 49
manufacturing facilities strategically located around the globe and
employs a team of over 6,500 professionals in 130 countries across
six continents. Solenis is a 2022 US Best Managed Company.
For additional information about Solenis, please visit
www.Solenis.com or follow us on social media.
About Bain Capital Private Equity
Bain Capital Private Equity has partnered closely with
management teams to provide the strategic resources that build
great companies and help them thrive since its founding in 1984.
Bain Capital Private Equity's global team of more than 250
investment professionals creates value for its portfolio companies
through its global platform and depth of expertise in key vertical
industries including healthcare, consumer/retail, financial and
business services, industrials, and technology, media and
telecommunications. Bain Capital Private Equity has 23 offices on
four continents. The firm has made primary or add-on investments in
more than 1,100 companies since its inception. For more
information, visit www.baincapitalprivateequity.com.
About Platinum Equity
Founded in 1995 by Tom Gores, Platinum Equity is a global
investment firm with approximately $36 billion of assets under
management and a portfolio of approximately 50 operating companies
that serve customers around the world. Platinum Equity specializes
in mergers, acquisitions and operations – a trademarked strategy it
calls M&A&O® – acquiring and operating companies in a broad
range of business markets, including manufacturing, distribution,
transportation and logistics, equipment rental, metals services,
media and entertainment, technology, telecommunications and other
industries. Over the past 27 years Platinum Equity has completed
more than 350 acquisitions.
Cautionary Statement Regarding Forward-Looking
Statements
This communication contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995, Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended,
which include all statements that do not relate solely to
historical or current facts, such as statements regarding the
Company’s expectations, intentions or strategies regarding the
future, including strategies or plans as they relate to the
proposed transaction. In some cases, you can identify
forward-looking statements by the following words: “may,” “will,”
“could,” “would,” “should,” “expect,” “intend,” “plan,”
“anticipate,” “believe,” “estimate,” “predict,” “project,” “aim,”
“potential,” “continue,” “ongoing,” “goal,” “can,” “seek,” “target”
or the negative of these terms or other similar expressions,
although not all forward-looking statements contain these words.
These forward-looking statements are based on management’s beliefs,
as well as assumptions made by, and information currently available
to, the Company. Because such statements are based on expectations
as to future financial and operating results and are not statements
of fact, actual results may differ materially from those projected
and are subject to a number of known and unknown risks and
uncertainties, including: (i) uncertainties as to the timing of the
proposed transaction; (ii) the risk that the merger may not be
completed in a timely manner or at all, which may adversely affect
the Company’s business and the price of the Company’s shares; (iii)
the possibility that competing offers or acquisition proposals for
the Company will be made; (iv) the failure to satisfy any of the
conditions to the consummation of the proposed transaction,
including the adoption of the merger agreement by the Company’s
shareholders and the receipt of certain regulatory approvals; (v)
the occurrence of any event, change or other circumstance or
condition that could give rise to the termination of the merger
agreement, including in certain circumstances requiring the Company
to pay a termination fee; (vi) the effect of the announcement or
pendency of the proposed transaction on the Company’s stock price,
business relationships, operating results and business generally;
(vii) risks that the proposed transaction may disrupt the Company’s
current business plans and operations; (viii) the Company’s ability
to retain and hire key personnel in light of the proposed
transaction; (ix) risks related to diverting management’s attention
from the Company’s ongoing business operations; (x) unexpected
costs, charges or expenses resulting from the proposed transaction;
(xi) the ability of the buyer to obtain the necessary financing
arrangements set forth in the commitment letters received in
connection with the merger; (xii) potential litigation relating to
the merger that could be instituted against parties to the Merger
Agreement or other transaction agreements or their respective
directors, managers or officers, including the effects of any
outcomes of such litigation; (xiii) certain restrictions during the
pendency of the merger that may impact the Company’s ability to
pursue certain business opportunities or strategic transactions;
(xiv) uncertain global economic conditions which have had and could
continue to have an adverse effect on our consolidated financial
condition and results of operations; (xv) the continuation of the
COVID-19 pandemic may cause disruptions to the Company's
operations, customer demand, and its suppliers’ ability to support
the Company; (xvi) the risks associated with the global nature of
the Company's operations; (xvii) fluctuations between non-U.S.
currencies and the U.S. dollar; (xviii) political and economic
instability and risk of government actions affecting the Company's
business and its customers or suppliers; (xix) increases in the
pricing of raw materials, availability and allocation by suppliers
as well as increases in energy-related costs; (xx) the Company's
ability to develop new and innovative products and the acceptance
of such products by the Company's customers; (xxi) cyber risks and
the failure to maintain the integrity of the Company's operational
or security systems or infrastructure; (xxii) the introduction of
the Organization for Economic Cooperation and Development’s Base
Erosion and Profit Shifting; (xxiii) the consolidation of the
Company's customers; (xxiv) competition in the markets for the
Company's products and services and in the geographic areas in
which it operates; (xxv) instability and uncertainty in the credit
and financial markets and the availability of credit that the
Company and its customers need to operate the Company's business;
(xxvi) new and stricter regulations applicable to our business;
(xxvii) continued availability of capital and financing and rating
agency actions; and (xxviii) other risks described in the Company’s
filings with the SEC, including its Annual Report on Form 10-K for
the fiscal year ended December 31, 2021, as may be updated or
supplemented by any subsequent Quarterly Reports on Form 10-Q or
other filings with the SEC. All such factors are difficult to
predict and are beyond the Company’s control. While the list of
risks and uncertainties presented here is, and the discussion of
risks and uncertainties to be presented in the proxy statement will
be, considered representative, no such list or discussion should be
considered a complete statement of all potential risks and
uncertainties. Unlisted factors may present significant additional
obstacles to the realization of forward-looking statements.
Consequences of material differences in results as compared with
those anticipated in the forward-looking statements could include,
among other things, business disruption, operational problems,
financial loss, and legal liability to third parties and similar
risks, any of which could have a material adverse effect on the
completion of the merger and/or the Company’s consolidated
financial condition, results of operations, credit rating or
liquidity. In light of the significant uncertainties in these
forward-looking statements, the Company cannot assure you that the
forward-looking statements in this communication will prove to be
accurate, and you should not regard these statements as a
representation or warranty by the Company, its directors, officers
or employees or any other person that the Company will achieve its
objectives and plans in any specified time frame, or at all.
The forward-looking statements speak only as of the date they
are made. The Company undertakes no obligation to update any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by applicable law.
Readers are cautioned not to place undue reliance on these
forward-looking statements.
Important Information For Investors and Shareholders
In connection with the proposed transaction, the Company intends
to file with the Securities and Exchange Commission (the “SEC”) and
furnish to shareholders a proxy statement on Schedule 14A. The
Company, certain of its affiliates and certain affiliates of Bain
Capital intend to jointly file a transaction statement on Schedule
13E-3 (the “Schedule 13E-3”) with the SEC. Promptly after filing
its definitive proxy statement with the SEC, the Company will mail
the definitive proxy statement, the Schedule 13E-3 and a proxy card
to each shareholder of the Company entitled to vote at the meeting
relating to the proposed transaction. This communication is not a
substitute for the proxy statement or any other document that the
Company may file with the SEC or send to its shareholders in
connection with the proposed transaction. INVESTORS AND
SHAREHOLDERS OF THE COMPANY ARE URGED TO READ THE PROXY STATEMENT,
THE SCHEDULE 13E-3 AND OTHER RELEVANT MATERIALS WHEN THEY BECOME
AVAILABLE BEFORE MAKING ANY VOTING OR INVESTMENT DECISION WITH
RESPECT TO THE PROPOSED TRANSACTION BECAUSE THEY CONTAIN IMPORTANT
INFORMATION ABOUT THE COMPANY AND THE PROPOSED TRANSACTION, THE
RISKS RELATED THERETO AND RELATED MATTERS. The materials to be
filed by the Company will be made available to the Company’s
investors and shareholders at no expense to them and copies may be
obtained free of charge on the Company’s website at
www.Diversey.com. In addition, all of those materials will be
available at no charge on the SEC’s website at www.sec.gov.
Participants in the Solicitation
The Company and its directors, executive officers, other members
of its management and employees may be deemed to be participants in
the solicitation of proxies of the Company’s shareholders in
connection with the proposed transaction under SEC rules. Investors
and shareholders may obtain more detailed information regarding the
names, affiliations and interests of the Company’s executive
officers and directors in the solicitation by reading the Company’s
proxy statement for its 2022 annual meeting of shareholders, the
Annual Report on Form 10-K for the fiscal year ended December 31,
2021, and the proxy statement and other relevant materials that
will be filed with the SEC in connection with the proposed
transaction when they become available. Information concerning the
interests of the Company’s participants in the solicitation, which
may, in some cases, be different than those of the Company’s
shareholders generally, will be set forth in the proxy statement
relating to the proposed transaction when it becomes available.
No Offer or Solicitation
This communication is not a proxy statement or solicitation of a
proxy, consent or authorization with respect to the proposed
transaction and is not intended to and shall not constitute an
offer to sell or the solicitation of an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any vote or approval, nor shall there be any sale of securities in
any jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230308005378/en/
FOR FURTHER INFORMATION:
Solenis Catherine Abernathy +1 904-910-1071
cmabernathy@solenis.com
Diversey Grant Graver ir@Diversey.com
Bain Capital: Charlyn Lusk/Scott Lessne +1 646-502-3549/+1
646-502-3569 clusk@stantonprm.com/slessne@stantonprm.com
Platinum Equity Dan Whelan +1 310-282-9202
dwhelan@platinumequity.com
Diversey (NASDAQ:DSEY)
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