Hexion Holdings Corporation announced that, as a result of its ongoing strategic review, it has entered into a definitive agreement to sell its epoxy-based coatings and composite businesses to Westlake Chemical Corporation. The sale is for approximately $1.2 billion.
Hexion’s epoxy business includes epoxy specialty resins, base epoxy resins, and intermediates product lines. It generated total sales of about $1.5 billion for the last 12 months, ending September 30, 2021. The transaction includes approximately 1,300 associates and eight manufacturing facilities, globally, where the epoxy-based coatings and composite products are produced for highly diversified growing end-markets
The markets include non-residential construction, industrial, electrical, automotive and aerospace, as well as wind energy.
“Today’s announcement is aligned with our ongoing commitment towards creating value for our shareholders,” said Craig Rogerson, chairman, president, and CEO. “Our associates in the epoxy business will be joining a leading global chemical manufacturer and we believe that the epoxy business will be well positioned going forward with Westlake as its new owner.”
Hexion expects to use the sale proceeds to further pay down debt and to invest in its business. The transaction is expected to close in the first half of 2022, subject to customary regulatory approvals and other closing conditions as well as prior Works Councils consultation.
Following completion of the transaction, Hexion will consist of its existing adhesives and Versatic acids and derivatives product lines. It will continue to build on its strong momentum, driven primarily by strong new residential construction and remodeling demand in North America, continued capacity expansion, and more sustainable building and coatings materials.
Hexion’s management team and its Board of Directors will continue to evaluate strategic value creation options for its adhesives and Versatic acid product lines.