COMPANY NEWS
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Direct by Design
From left: Aligned MBCC and SIKA core technologies; Current MBCC and SIKA footprints across the globe
SIKA to take over MBCC
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ithin two years of acquiring the MBCC Master Builders Solutions brands from BASF, private equity firm Lone Star of Texas, USA, has signed a €5.2 billion deal for SIKA to acquire what it sees as highly complementary combination core technologies to drive sustainability transformation of the construction industry. The acquisition will broaden Sika product and solution offerings in four of its five core technologies and in seven of eight of its target markets and benefit customers from strengthened geographic footprint an enhanced and more efficient distribution network across all construction markets. The agreed deal, for a consideration of €5.2 billion, values MBCC at about €2 billion more than the €3.2 billion paid by Lone Star two years ago to acquire MBCC from BASF. In responding to the point, Sika CEO Thomas Hasler said that Sika had considered acquiring MBCC two years ago but that it was in the process of acquiring the mortar manufacturing company Parex at the same time and decided to concentrate on that CHF 1.2 billion acquisition, its largest at the time, first. “The profitability of MBCC has also improved in the two years of ownership by Lone Star,” said Hasler. “It is a much better purchase now that is was then and with the MBCC carve-out from BASF is also now totally completed.” The acquisition he said provides improved combines sales of the two companies from a current €9 billion (€2.7 billion by MBCC) to €11.8 billion and with a projection of combined group sales in excess of €13 billion by 2023.
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The deal is subject to regulatory approvals in the many national jurisdictions where both companies currently operate competitively. Sika said it eager to work with authorities and to take action to resolve any competitive conflicts, as “time is critical” said Hasler. A target for closing the acquisition is by second half of 2022. Sika has secured a bridge loan facility to finance the transaction. For the MBCC range of underground construction (UGC) industry products, there will be cross over with Sika in the concrete additives and admixtures, and the water control and waterproofing, membranes ranges. These will include the MBCC TPH range of acrylates and polyurethanes for
18 Nov 2021 TunnelTalk reporting
Underground in Action U
Hear the news in the recent SIKA media announcement webcast
ground consolidation and water control and the Bluey range of construction chemicals and services for the infrastructure market. Combining the operational and manufacturing footprint of Sika and MBCC is expected to accrue annual cost synergies in the range of CHF160-180 million by 2025. Reducing the carbon footprint of the construction industry is a key of the acquisition. “Two sustainability champions across the entire construction life cycle are to join forces,” said Hasler. “Together, we will enable and accelerate the future of sustainable construction. Efforts to reduce the carbon footprint in the construction industry is picking up, but the speed is by far not in line with what was being discussed at COP26 in Glasgow. We need more firm directions to help make this transformation faster. Today, 70% of Sika sales are generated by products that have a positive effect on sustainability and more than 35% of MBCC Group products are sustainably advanced. Through the combination, Sika is committed to generating 80% of its sales from products that positively impact sustainability.” With about 7,500 employees and operations in more than 60 countries and more than 130 production facilities, Jochen Fabritius, CEO of MBCC Group, said: “We have found a perfect partner who shares our core beliefs. Together with Sika, we are looking forward to exploring new and exciting business opportunities.” He thanked Lone Star for the “tremendous support during the past few years and for helping us to prepare for this next chapter.” n
References •
BASF carves out and sells MBCC Group – TunnelTalk, October 2020
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MBCC Group adds to underground portfolio – TunnelTalk, March 2021
