The transaction will include all of DSM’s Resins & Functional Materials businesses, including DSM Niaga®, DSM Additive Manufacturing and the coatings activities of DSM Advanced Solar. These businesses represented €1,012 million of DSM’s 2019 total annual net sales and €133 million of DSM’s 2019 total EBITDA.
DSM will provide re-stated figures for its Materials Cluster ahead of its Q3 results. DSM anticipates a book profit on the transaction to be recognized upon closing. DSM expects to receive approximately €1.4 billion net in cash following closing, including repayment of RFM’s net debt, and after transaction costs and capital gains tax.
The combination of RFM and Covestro will create a business of enhanced scale and technological capability that will benefit existing and potential customers as well as its employees through a stronger platform for growth. Completion of the transaction, which is subject to the customary conditions and approvals, is expected in H1, 2021.
Geraldine Matchett and Dimitri de Vreeze, Co-CEOs of Royal DSM, commented: “This sale builds on our approach of actively managing our businesses, as DSM continues to evolve as a purpose-led, science-based company operating in the fields of Nutrition, Health and Sustainable Living. The deal delivers strong value to DSM and is strategically attractive for all parties. In Covestro, we recognize a company that shares similar views on culture and the value of sustainability. We know that Covestro will be a good owner of these businesses for customers, colleagues and other stakeholders.”
About Resins & Functional Materials and associated businesses (RFM)
DSM Resins & Functional Materials, containing a Sustainable Coatings division and a Functional Materials division, provides highly-specialized, market-leading products such as resins for use in paints and other industrial applications, and optical fiber coatings. This includes DSM Niaga®, a VOC-free adhesive and a proprietary production technology for fully-recyclable carpets, mattresses and furniture components.
DSM Additive Manufacturing provides performance materials and deep application expertise in 3D-printing to help manufacturers rethink the way they design products to manufacture tomorrow. DSM Advanced Solar coatings are high performing anti-reflective coatings used for solar glass activities. The division’s activities in next-generation backsheets for photovoltaic modules remains as DSM Advanced Solar as part of DSM.