Celanese to Buy Most of DuPont’s Mobility and Materials Unit for $11 Billion
The deal includes customer and supplier contracts and agreements and an intellectual-property portfolio
Chemical and specialty materials company Celanese Corp. CE -2.03% has reached a deal to buy most of DuPont de Nemours Inc.’s DD -2.91% mobility and materials unit for $11 billion.
The deal includes customer and supplier contracts and agreements, a global production network of 29 facilities and an intellectual-property portfolio, Celanese said.
DuPont’s mobility and materials business, which makes polymers, resins and various products for cars and other applications, generated sales of about $5 billion last year, or almost a third of the company’s total annual sales.
“M&M has historically been a strong generator of cash flow. We are confident in our ability to capture synergies that would allow us to double Celanese total free cash flow within the next five years,” Celanese Chief Financial Officer and Executive Vice President Scott Richardson said.
DuPont said the deal represents an enterprise value multiple of 14 times the business’ 2021 operating earnings before interest, taxes, depreciation, and amortization.
The deal is expected to close around the end of 2022, the companies said.
Shares of DuPont rose more than 2% in premarket trading while Celanese stock was flat.
Dupont agreed in November to pay about $5.2 billion for Rogers Corp. , and said at the time that it planned to sell most of its mobility and materials unit.
DuPont emerged from the three-way breakup of Dow DuPont Inc., which was formed by the merger of Dow and DuPont in 2015. DowDuPont’s materials-science business is now Dow Inc. and its agriculture operation is Corteva Inc.
The company in early 2020 brought back the chief architect of the megamerger and spinoff, Edward D. Breen, as its chief executive after the moves left the smaller industrial-materials maker struggling to generate sales growth. Mr. Breen said at the time the company didn’t meet expectations and needed to accelerate operational improvement.