Platform Specialty Products To Buy Arysta LifeScience In $3.51 Bln Deal

(RTTNews) - Specialty chemicals company Platform Specialty Products Corp. (PAH) agreed Monday to acquire crop solutions provider Arysta LifeScience Ltd. in a deal valued at about $3.51 billion. The deal is expected to close in the first quarter of 2015,

"This is a watershed event for Platform. Over the past twelve months we have demonstrated significant progress and exercised tremendous discipline as we executed against our build-up strategy. Through the acquisitions of Arysta, CAS, and Agriphar we have established a leading position within an attractive asset-lite, high-touch specialty chemicals vertical," Platform's Founder and Chairman Martin Franklin said in a statement.

Dublin, Ireland-based Arysta, backed by the European private-equity firm Permira, is a provider of crop solutions with expertise in agrochemical and biological products. It offers market-leading insecticides, fungicides, herbicides, biostimulants and value-added nutrients.

Arysta has a portfolio of 3,600 product registrations in more than 100 countries and reported net sales of $1.5 billion for fiscal 2013. It had filed paperwork with the U.S. SEC in September for an initial public offering.

The proposed deal is expected to immediately add more than 20 percent to Platform's 2014 adjusted earnings per share, before synergies.

Miami, Florida-based Platform, partly owned by activist investor Bill Ackman, said the deal is likely to be funded through a combination of cash on hand, convertible equity, debt, and equity. Meanwhile, Platform confirmed the deal will not have any impact on its status as a U.S.-domiciled company.

Following the acquisition, Arysta's President and Chief Executive Wayne Hewett, who led it since 2009, is expected to join Platform's senior leadership team as its president. Hewett will also lead Platform's three agrochemical businesses in cooperation with the strong management teams from Arysta, Chemtura AgroSolutions (CAS) and Agriphar.

Platform is expected to realize synergies in excess of $65 million from the combination of Arysta, CAS, and Agriphar acquisitions over the next three years, due to the complementary nature of the businesses.

"As we work to accelerate the organic growth within these businesses, we remain opportunistic on the acquisition front and will look to strategically expand our portfolio across other attractive, niche verticals," Franklin added.

Looking ahead to the third quarter, Platform said it expects net sales to be in the range of $195 million to $197 million, up from the $188.4 million it reported in the year-ago quarter.

For the nine-month period, it projects net sales to be in the range of $568 million to $570 million, higher that the $560.0 million it reported in the prior-year period.

Arysta was formed through the merger of Japan-based Tomen and Nichimen in 2001, and was then acquired by buyout firm Permira in 2008 for about $3 billion. Arysta LifeScience is currently among the top 15 agrochemical companies in the world. The company offers insecticides, fungicides, herbicides, biostimulants, and value-added nutrients.

Platform Specialty has now signed a number of acquisitions deals recently. In April, it agreed to buy Chemtura AgroSolutions, a provider of agrochemicals and seed treatment products, from Chemtura Corp. (CHMT) for about $1 billion in cash and stock. In August, the company agreed to buy Agriphar, a premier European agrochemicals group, in a 300 million euro deal.

PAH closed Friday's regular trading session at $24.29, down $0.71 on a volume of 0.16 million shares. In the past 52-week period, the stock has been trading in a range of $11.75 to $28.95.