Celanese to buy DuPont's materials arm for US$11b

[TEXAS] Celanese Corp agreed to buy the majority of DuPont de Nemours's mobility and materials arm for $11 billion in cash, the company's biggest-ever acquisition.

The agreement announced Friday confirms an earlier Bloomberg News report that the companies were close to a deal. The unit had also attracted interest from private equity firms including Apollo Global Management and Carlyle Group.

Texas-based Celanese makes chemicals and other products for use in everything from cigarette filters to paints, while the DuPont unit it's buying produces polymers and resins for vehicles, electronics, consumer products and other applications.

"The acquisition of the M&M business is an important strategic step forward and establishes Celanese as the preeminent global specialty materials company," chairman and chief executive officer Lori Ryerkerk said.

Celanese predicts the purchase will generate about US$450 million of synergies within the four years following the close of the deal, and add US$4.00 or more to adjusted earnings per share by 2026.

The transaction ranks as one of the five biggest year-to-date and the largest chemicals deal since 2020, according to data compiled by Bloomberg. DuPont worked with Goldman Sachs Group on the sale while Celanese was advised by Bank of America.

When DuPont agreed in November to pay about US$5.2 billion for Rogers, it announced plans to sell most of the mobility and materials unit. DuPont intends to use the proceeds from the sale to fund the Rogers purchase, as well as further M&A opportunities and continuing share repurchases.

DuPont is separately moving ahead with the sale of its Delrin business, with a target closing date in the first quarter of 2023.

DuPont chief executive officer Ed Breen, a serial dealmaker, has transformed the company into a business focused on electronics, automotive and water and industrial technologies. He led the 2017 tie-up of DuPont and Dow Chemical, the largest-ever chemicals industry merger, and the subsequent breakup that formed three standalone companies. BLOOMBERG