REG - Elementis PLC - Sale of Talc business and intended buyback launch

ElementisAnnouncement

Tue 07:00

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RNS Number : 0923K  Elementis PLC  27 May 2025

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the EU Market Abuse
Regulation (EU) No.596/2014 as it forms part of UK law by virtue of the
European Union (Withdrawal) Act 2018. Upon the publication of this
announcement via a regulatory information service, this inside information is
now considered to be in the public domain.

27 May 2025

Elementis plc

Sale of Talc and intended launch of share buyback programme

 

Elementis plc ("Elementis" or the "Group"), a global specialty chemicals
company, today announces that it has simultaneously signed and completed the
sale of its Talc business to IMI Fabi S.p.A ("IMI Fabi"), a global talc
manufacturer, for an enterprise value of $121m(1), with net cash proceeds
after transaction costs in the region of $55m(1) (the "Transaction").

The Transaction follows the strategic review of the Talc business (announced
in August 2024) to evaluate whether the full potential of Talc could best be
delivered as part of Elementis, or via a divestment. The Board of Elementis
believes that the sale to IMI Fabi represents the best outcome for all
stakeholders. As a result of the Transaction, all sites, employees, assets and
liabilities of Talc will move under IMI Fabi's ownership and, following a
short transitional period, will trade under Mondo Minerals as well as its
other affiliated IMI Fabi brands.

The sale represents a key milestone in Elementis' repositioning as a pure-play
specialty chemicals leader with a high-quality portfolio that is focused on
value-added specialty additives in the high-margin Coatings and Personal Care
markets.

The disposal improves the Group's adjusted operating profit margin by
approximately 240 bps(2), based on the Group's reported financial results for
the year ended 31 December 2024. The Transaction also accelerates the
delivery of the Group's 2026 financial targets(3). The Group's future
strategic priorities and performance objectives under new CEO, Luc van
Ravenstein, appointed on 29 April 2025, will be communicated in due course.

In recognition of Elementis' robust balance sheet and the strong confidence in
the streamlined Group's prospects, the Board is pleased to announce its
intention to return $50m to shareholders by way of a share buyback programme
which is expected to commence as soon as practicable. The Group's progressive
dividend policy remains unchanged as a result of the Transaction.

Outlook

The Group's positive outlook for this financial year remains unchanged from
that set out in our Q1 trading update on 29 April 2025.

 

Luc van Ravenstein, CEO of Elementis commented:

"The Board of Elementis conducted an extensive review of the Group's strategic
options and concluded that the full potential of Talc would be best delivered
via a sale of the business.

We are confident that the combination with IMI Fabi represents the right
outcome for the business and best serves the long-term interests of its
customers and employees. I would like to take this opportunity to thank all of
our Talc colleagues for their dedication, professionalism and service to our
customers under Elementis' ownership.

The Transaction marks a new chapter in the Group's transformation into a
pure-play specialty chemicals leader enabling us to focus on and grow our
Coatings and Personal Care businesses where we see the greatest potential for
profitable, cash-generative growth."

 

Webcast and conference call details

A virtual presentation for investors and analysts will be held at 09:00 BST on
Tuesday 27 May via a live webcast and can be accessed via the details below:

A copy of the presentation will be available for download from 07:00 BST this
morning at Results, Reports and Presentations | Elementis Global
(https://www.elementis.com/investors/investor-information/results-reports-and-presentations/)

Webcast link:
https://www.investis-live.com/elementis/6827597a800d38000f88721b/kavel
(https://www.investis-live.com/elementis/6827597a800d38000f88721b/kavel)

Conference call dial-in:

United Kingdom (Local): +44 20 3936 2999

United Kingdom (Toll-Free): +44 808 189 0158

Global Dial-In Numbers
(https://nam12.safelinks.protection.outlook.com/?url=https%3A%2F%2Flinks.uk.defend.egress.com%2FWarning%3FcrId%3D682ee3ef43232ba64ad453cc%26Domain%3Delementis.com%26Threat%3DeNpzrShJLcpLzAEADmkDRA%253D%253D%26Lang%3Den%26Base64Url%3DeNoVyVEKgCAMANAT5aggIoi-O4bOpYFuoYtdP3q_L6s-fQMwM8ekTXzsWcyhVEDhixox3pwgFQm-DPzWQK0f_51xX-dxWj6Gdhk2%26%40OriginalLink%3Dwww.netroadshow.com&data=05%7C02%7Czeeshan.maqbool%40elementis.com%7C952174c262a44d09619c08dd990ce03d%7Cbddf226eb2554875a364b0ea4bfb7a5e%7C0%7C0%7C638835002881242519%7CUnknown%7CTWFpbGZsb3d8eyJFbXB0eU1hcGkiOnRydWUsIlYiOiIwLjAuMDAwMCIsIlAiOiJXaW4zMiIsIkFOIjoiTWFpbCIsIldUIjoyfQ%3D%3D%7C0%7C%7C%7C&sdata=avPSk3hML6DYXQH4UkzqxJ6N9oprnJ0H5CJ90N%2FF%2FJY%3D&reserved=0)
 

Access Code: 392370

 

Enquiries

Elementis plc

 

Zeeshan Maqbool, Head of Investor Relations
        Tel: 07553 340 380

 

Rothschild & Co

Ravi Gupta / Nathalie
Ferretti
Tel: 020 7280 5000

 

Teneo

Martin Robinson / Giles
Kernick
Tel: 020 7260 2700

 

The personal responsible for the release of this announcement on behalf of
Elementis is Lynton Boardman, Company Secretary.

Notes

1.   Enterprise value €107m, net cash proceeds after transaction costs in
the region of €48m. Converted at exchange rate of €1 = $1.1379.

2.   Includes $1m of stranded costs.

3.   2026 targets as set out in November 2023 CMD: 19%+ adjusted operating
profit margin, over 90% operating cash conversion, and over 20% return on
capital employed (excluding goodwill).

 

About Elementis

Elementis is a global specialty chemicals company. We offer performance-driven
additives that help create innovative formulations for consumer and industrial
applications. As a FTSE 250 company, listed on the London Stock Exchange, we
employ c.1,030 people globally. We have a nearly 200-year tradition of
creating ingredients that add value to everyday consumer and industrial
products. In 2024 Elementis reported revenue of $738m and adjusted operating
profit of $129m.

 

About Talc

Talc is a mine-to-market integrated producer and supplier of premium talc,
with focus on industrial talc additives which add critical performance
features to end products.

 

About IMI Fabi

IMI Fabi is a global talc manufacturer that was established in the 1950s in
Valmalenco (SO) Italy. IMI Fabi's operating network produces and distributes
high quality talc products for customers in the plastic, paper, paints and
fillers, animal feed, building coatings, ceramics, pharmaceuticals and other
industries. The company's success stems from its commitment to sustainable
value creation, its strategic investment policy and its culture of providing
innovative industrial solutions for its customers.

 

Important notice

N.M. Rothschild & Sons Limited ("Rothschild & Co"), which is
authorised and regulated in the UK by the Financial Conduct Authority, is
acting exclusively as financial adviser to Elementis and for no‑one else in
connection with the sale which is the subject of this announcement and shall
not be responsible to anyone other than Elementis for providing the
protections afforded to clients of Rothschild & Co, nor for providing
advice in connection with the announcement or any matter referred to herein.
Neither Rothschild & Co nor any of its affiliates (nor their respective
directors, officers, employees or agents) owes or accepts any duty, liability
or responsibility whatsoever (whether direct or indirect, whether in contract,
in tort, under statute or otherwise) to any person who is not a client of
Rothschild & Co in connection with this announcement or any statement
contained herein. No representation or warranty, express or implied, is made
by Rothschild & Co as to the contents of this announcement.

Allen Overy Shearman Sterling LLP is acting as legal adviser to Elementis in
connection with the sale of its Talc business.

 

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