Imerys accelerates its development and concludes a strategic combination with S&B

Imerys announces today a strategic combination for the integration of the main activities of S&B, a major player in industrial minerals held by the Kyriacopoulos founder family (61%) and Rhône Capital (39%). Through this operation, Imerys would accelerate its development by enlarging its specialties offer. The transaction, partially paid in Imerys shares, would rapidly create value for Imerys’ shareholders, based on a € 525 million equity value for 100% of the shares, increased by a performance amount not to exceed € 33 million. In this context, the Kyriacopoulos family, S&B’s shareholders for more than 80 years, would become stockholders of Imerys together with its controlling shareholder, GBL group.

A major player in industrial minerals with a wide range of products and applications, S&B is serving diversified end-markets in Western Europe, North America as well as European and Asian emerging countries. A global supplier and European leader in bentonite (binders for foundry, sealing solutions, additives for drilling and for consumer products), S&B is the world leader in continuous casting fluxes for the steel industry as well as in wollastonite (functional additives for polymers and paints). S&B is providing also perlite-based solutions used in construction materials and horticulture.

A major player in industrial minerals with a wide range of products and applications, S&B is serving diversified end-markets in Western Europe, North America as well as European and Asian emerging countries. A global supplier and European leader in bentonite (binders for foundry, sealing solutions, additives for drilling and for consumer products), S&B is the world leader in continuous casting fluxes for the steel industry as well as in wollastonite (functional additives for polymers and paints). S&B is providing also perlite-based solutions used in construction materials and horticulture.

This strategic combination would be accretive to the Group’s net income from current operations per share from the first year of integration and value creative from the third full year of consolidation, thanks especially to the significant development synergies that are expected. The consideration should be paid in cash for about € 311 million, financed by Imerys’ available financial resources. The balance of € 214 million should be paid in Imerys shares to be issued on a preemptive basis exclusively to the Kyriacopoulos family. Including S&B’s net financial debt which amounted € 235 million as of June 30, 2014, Imerys would maintain a very robust financial structure with a net financial debt to equity ratio below 60%, after the transaction.

The completion of this transaction remains subject to the approval of the relevant regulatory authorities and should take place during the first quarter of 2015. The Kyriacopoulos family, who would hold around 4.4% of Imerys’ shares upon completion of the transaction, has entered into a shareholders’ agreement with GBL group which would become effective as of completion date. This agreement in particular would grant to the Kyriacopoulos family the right of representation on the Imerys’ Board of Directors.

Gilles Michel, Chairman & CEO of Imerys, commented: “This transaction represents a major milestone in Imerys’ development strategy. By welcoming S&B’s teams, sharing with us similar culture and values, we will strengthen together our global positions in the mineral-based specialty solutions for industry. The enrichment of the potential for innovation and the acceleration of the international deployment, based on the complementarity of our two companies, will be growth drivers that will create value for our shareholders. I would be glad to welcome a representative of the Kyriacopoulos family on Imerys Board of Directors.”

Ulysses Kyriacopoulos, Chairman of S&B, added: “By combining our operations with the world leader in industrial minerals, S&B takes a decisive step in its global growth strategy, for the benefit of its customers. Driven by the same strong entrepreneurial values, our employees will find new development opportunities in this combination. I would be honored to join the Board of Directors of Imerys alongside representatives of its controlling shareholders and participate in the strategic decisions that will accelerate its growth.”