London – Synthomer plc has completed the previously announced divestment of its latex compounding operations to Belgian chemicals company Matco NV.
The value of the transaction was €27.5 million, equivalent to an EV/stand-alone trailing earning (EBITDA) multiple of six times, announced London-based Synthomer 1 May.
Synthomer went on to say that the divestment is expected to result in "a modest profit on disposal," with the proceeds to be used to reduce group net debt.
Headquartered in Waregem, Belgium, Matco specialises in compounds, water-based adhesives, and solutions for various industrial applications.
As previously announced by Synthomer, the divested business was part of the group's ‘health & protection and performance materials division’ and was designated as "non-core" to the group in October 2022.
The unit produces certain latex-based compounds and curing additives used in the manufacture of products for a range of end markets, including flooring and artificial grass.
According to Synthomer, the business comprises two manufacturing sites: one in The Netherlands and the other in Egypt.
Last year, the business generated stand-alone adjusted earnings (EBITDA) of €4.8 million and had gross assets of € 56 million at the end of the period.
Synthomer CEO Michael Willome said on 15 April that the divestment is consistent with the group's strategy to increase “the speciality weighting of the group” and reduce the complexity of its site portfolio.
Willome added that the UK group also aims to enhance its focus on “higher value and higher growth markets” where it has “strong and sustainable leadership positions.”