Univar Solutions Inc., Downers Grove, Ill., a global specialty chemical and ingredient distributor, and Apollo, New York, a global asset manager, on March 14 announced that funds managed by affiliates of Apollo have entered into a definitive merger agreement to acquire Univar in an all-cash transaction that values the company at an enterprise value of approximately $8.1 billion. The transaction includes a minority investment from a wholly-owned subsidiary of the Abu Dhabi Investment Authority (ADIA).
The agreement provides that Univar shareholders will receive
$36.15 per share in cash, which represents a 20.6% premium to the company’s undisturbed
closing stock price on Nov. 22, 2022. The transaction consideration also
represents a premium of 33.6% to the volume-weighted average price of Univar
Solutions for the 30 trading days ending on Nov. 22, 2022.
Bloomberg reported in January that Univar had attracted interest from potential bidders, including Apollo Global Management Inc. and Platinum Equity (GM Jan. 13, p. 27). Univar had ended talks earlier that month with Brenntag SE (GM Jan. 6, p. 2; Dec. 2, 2022), saying it would continue talks relating to “other indications of interest.” At the time, sources said a private company deal for Univar would incur less antitrust risk than a merger with a peer, and would likely make it easier to restructure. Univar has one of the largest private transportation fleets for chemicals in the world, and its distribution portfolio includes fertilizer and other crop inputs.
“We are pleased to have reached this agreement with
Apollo, which will provide immediate and certain cash value for Univar
Solutions shareholders,” said Chris Pappas, Chairman of the Univar Board
of Directors. “The Board’s decision follows a comprehensive review of
value creation opportunities for Univar Solutions. We are confident this
transaction is the right path forward and achieves our goal of maximizing value
for Univar Solutions shareholders.”
“Over the last three years, we have transformed the company,
putting the customer at the center of all we do, which has solidified our
position as a leading value-added service and solution provider,” said David
Jukes, Univar President and CEO. “This transaction reflects the success of our
strategy and delivers substantial value to our shareholders. It is a testament
to the tireless efforts of my colleagues, whose commitment to our purpose of
helping keep our communities healthy, fed, clean, and safe has enabled our
success. In Apollo, we are pleased to gain a partner to support continued
investment in our portfolio and I look forward to working closely with their
team as we grow Univar Solutions and serve our key suppliers and customers
globally.”
“Univar is a global leader in specialty chemicals and
ingredients distribution, fueling a vast array of industries with innovative,
safe, and sustainable solutions,” said Apollo Private Equity Partner Sam Feinstein.
“In recent years, David and his team have made tremendous progress enhancing
the customer experience, and we believe Univar can accelerate its long-term
strategy as an Apollo Fund portfolio company. We look forward to leveraging our
extensive experience in the sector to support management in this exciting next
phase.”
The transaction is expected to close in the second half of
2023, subject to customary closing conditions, including approval by Univar
shareholders and receipt of regulatory approvals.
Once the deal is completed, Univar common stock will no
longer trade on the New York Stock Exchange, and Univar will become a privately
held company. Univar will continue to operate under the Univar Solutions name
and brand and maintain a global presence.
While Univar’s distribution includes fertilizer, it made the
decision in 2020 to exit macronutrients in favor of micronutrients and
inoculants (GM Aug. 14, 2020).
The company’s 2016 acquisition of NexusAg
Business Inc. (GM March 25, 2016) through its wholly-owned subsidiary,
Univar Canada Ltd., added a proprietary line of micronutrients, macronutrients,
and specialty fertilizers – in addition to potash, phosphates, and liquid and
soluble fertilizer – to Univar’s existing macronutrient and crop protection
inputs portfolio.
In 2019, NexusAg began a sole distribution
agreement with Novozymes for its downstream biological products in Canada (GM
July 19, 2019), resulting in the renaming of NexusAg to NexusBioAg.
It boosted Canadian agriculture distribution in
2015 with the purchase of Future Transfer Co. Inc., BlueStar Distribution Inc.,
and BDI Distribution West Inc., which provided logistics, warehousing,
packaging, and formulation services for the industry (GM Oct. 12, 2015).
Other acquisitions have included Key Chemical
Inc., a supplier of fluoride and other chemicals to the municipal water,
industrial, and oil and gas markets, including aqua ammonia, caustic potash,
lime, phosphoric acid, and sulfuric acid (GM April 20, 2015), and Magnablend,
a Texas-based provider of custom chemical manufacturing, blending, and
packaging solutions (GM Dec. 10, 2012), whose services included
specialty fertilizer blending, such as NPKs (powder and liquid), soluble boron,
foliar, and adjuvant, microemulsions, dispersions, micronutrients, nitrogen
stabilizers, and root enhancers.
Univar also has an exclusive partnership with Nutrien Ltd. for the marketing and distribution of hydrofluorosilicic acid (HFS or FSA) in the US and Canada (GM Feb. 5, 2021). The product is used by municipal water plants. Sourcing is from Nutrien’s phosphate facility in White Springs, Fla.
It acquired The Mosaic Co.’s HFS business in
2020 (GM March 6, 2020).
