Lanxess tops STOXX after partnering with Advent to buy DSM's engineering materials biz
31/05/2022 08:53
(Updates share move, adds analyst comments, milestone)
** Shares of German speciality chemicals maker Lanxess
LXSG.DE rise 11% to the top of Europe's STOXX 600 index
.STOXX after announcing a joint venture with Advent
International for high-performance plastics urn:newsml:reuters.com:*:nFWN2XM0AY
** Lanxess and Advent agree to buy DSM's DSMN.AS
engineering materials business for around EUR 3.7 bln ($3.97
bln) financed by Advent, to be included in the JV urn:newsml:reuters.com:*:nASM000DW0
** Lanxess will transfer its high-performance materials
business, valued at EUR 2.5 bln, into the combination
** The companies anticipate substantial synergies resulting
from the JV by 2026
** Lanxess LXSG.DE to receive a payment of at least EUR
1.1 bln at closing and a stake of up to 40% in the JV
** "Financially, this transaction represents a material
deleveraging event for Lanxess," says Jefferies, noting the deal
also helps the company fund its acquisition of IFF's IFF.N
microbial control unit urn:newsml:reuters.com:*:nL1N2PU27Y
** "We note, importantly, Lanxess has the option to divest
its remaining shareholding within three years," the broker adds
** Credit Suisse says a significant positive after recent
concerns would represent a cash out event for Lanxess
** Lanxess also tops the German mid-cap index .MDAXI
** The stock, down 20% YTD, is on track for its best day
since March 9
($1 = 0.9316 euros)
(Reporting by Anastasiia Kozlova and Tristan Chabba)
((Anastasiia.Kozlova@thomsonreuters.com ;
Tristan.chabba@thomsonreuters.com))