Oct. 3 (Bloomberg) -- PolyOne Corp., a U.S. supplier of plastics and resins, agreed to buy ColorMatrix Group Inc. for $486 million to broaden its offering to specialty additives and colorants used in packaging.
PolyOne is adding a business that had sales of $196.8 million and earnings before interest, taxes, depreciation and amortization of $43.6 million in the 12 months through June 30, the Avon Lake, Ohio-based company said in a statement today. Completion of the deal is expected by year end.
PolyOne, which bought GLS Corp. for $148.5 million in 2008, views the acquisition as a “game changer” that will drive expansion into value-added products and markets such as Russia, Chief Executive Officer Stephen Newlin said. With ColorMatrix, more than 50 percent of PolyOne’s operating profit will stem from specialty products, compared with 2 percent in 2005.
“Since 2002, ColorMatrix has organically increased EBITDA at an annualized growth rate of 16 percent, and our purchase price of $486 million recognizes the earnings and growth potential of this specialty business,” said Newlin. “We can accelerate this growth by leveraging our global scale and through additional investment in commercial resources, just as we’ve done with GLS.”
PolyOne was advised by Valence Group on the deal. Privately held ColorMatrix is based in Berea, Ohio.
--Editors: David Risser, Jerrold Colten
To contact the reporter on this story: Andrew Noel in London at firstname.lastname@example.org
To contact the editor responsible for this story: Benedikt Kammel at email@example.com