Alternative asset manager The Carlyle Group and DuPont have signed a definitive agreement whereby Carlyle will purchase DuPont Performance Coatings (DPC) for USD4.9bn in cash.
The transaction is expected to close in the first quarter 2013, subject to customary closing conditions and regulatory approvals.
DPC is a global supplier of vehicle and industrial coating systems with 2012 expected sales of more than USD4bn and more than 11,000 employees. The investment will be funded with equity from Carlyle Partners V and Carlyle Europe Partners III.
“DuPont Performance Coatings is a leader in the automotive and industrial coatings sectors with world-class products and customer service. The business continues to grow and deliver solid results. After a careful review, however, we have determined that DPC’s full growth potential would be best realised outside DuPont and through the sale to Carlyle,” says DuPont chair and chief executive Ellen Kullman. “This transaction is consistent with our vision to be the world’s most dynamic science company and long-term strategy of driving competitive advantages in agriculture and nutrition, advanced materials and biotechnology, which represent high-growth, high-margin opportunities.”
Greg Ledford (pictured), Carlyle managing director and head of the industrial and transportation team, says: “DuPont Performance Coatings is a successful business with attractive market positions, next-generation technology and established brands. Through targeted investments we will support DPC’s product development and growth objectives as it transitions to a stand-alone company. We look forward to working with management to fully realise DPC’s great potential.”
Kullman stressed that DuPont remains committed to serving the automotive industry. Following the closing of this transaction, DuPont will generate more than USD3bn in sales of advanced materials to the auto industry.
Carlyle’s industrial and automotive investments include Allison Transmission, Hertz and PQ Corporation, as well as recent commitments to invest in Hamilton Sundstrand Industrial, Sunoco’s Philadelphia refinery and regional rail freight operator Genesee & Wyoming.