Leucadia National To Sell Conwed Plastics To Schweitzer-Mauduit

(RTTNews) - Leucadia National Corp. (LUK) said that it has entered into a definitive purchase agreement to sell 100% of Leucadia's wholly owned subsidiary, Conwed Plastics, to Schweitzer-Mauduit International, Inc., (SWM).

Under the terms of the transaction, which is expected to close in January 2017, Leucadia will receive $295 million in cash at closing plus potential earn-out payments over five years of up to $40 million in cash to the extent the results of Conwed's subsidiary, Filtrexx International, exceed certain performance thresholds.

As of September 30, 2016, Leucadia's net investment in Conwed was $104 million, of which $46 million was tangible book value. Leucadia estimates it will recognize a pretax gain of approximately $175-185 million, excluding value associated with the earn-out, upon the closing of this sale.