LONDON, UK: Quanex Building Products Corporation has reached agreement on the terms of a recommended cash and share offer to acquire Tyman Plc. The transaction is intended to be implemented by means of a court-sanctioned scheme of arrangement under Part 26 of the Companies Act.
Under the terms of the transaction, Tyman shareholders will be entitled to receive 240 pence in cash; and 0.05715 of a new Quanex Share. The main offer comprises approximately 60 per cent by value in cash and approximately 40 per cent by value in New Quanex Shares.
As an alternative, Tyman shareholders will be able to elect to receive the consideration in respect of their entire holding of Tyman shares in Quanex shares at a ratio of 0.14288 of a new Quanex share to every 1 Tyman share held at the Scheme Record Time.
The transaction values the entire issued and to be issued share capital of Tyman Plc at approximately £788 million.
Tyman Plc is a leading international supplier of engineered fenestration components and access solutions to the construction industry. The Group designs and manufactures products that enhance the comfort, sustainability, security, safety and aesthetics of residential homes and commercial buildings.
Tyman’s portfolio of leading brands serve their markets through three regional divisions (North America, UK and Ireland and Europe) and cover all aspects of the hardware and sealing solutions required for doors and windows, and a full suite of solutions for roof, wall and floor access in residential and commercial buildings.
The Quanex Directors believe that the acquisition of Tyman offers compelling industrial logic and strategic rationale, while offering a significant value creation opportunity for stockholders in the Enlarged Group, as it presents a unique opportunity to create a larger, more diversified supplier of components and access solutions to customers in the building products sector, particularly across the fenestration portfolio in North America
In addition, the Enlarged Group will benefit from an enhanced financial profile with increased scale with combined fiscal year 2023 revenues of approximately US$2 billion and attractive profitability driven by significant synergy potential with a higher EBITDA margin (based on financial year ended 31 October 2023 for Quanex and 31 December 2023 for Tyman and after taking into account the impact of run-rate cost synergies of US$30 million expected to be fully achieved by the second year following completion of the Transaction.
Commenting on the Transaction, Mr. George L. Wilson, the Chairman of the Board, President and Chief Executive Officer of Quanex, said: “This transformative acquisition accelerates our journey to becoming “BIGGER”, creating a leading supplier of building products with a more diverse geographic footprint, product offering and customer base. With significantly enhanced scale, we are looking forward to fully optimizing our portfolio of products and assets to position Quanex as a comprehensive solutions provider for our customers. Importantly, we expect employees of both companies to also benefit from increased opportunities as part of a larger organization with expanded engineering, design and manufacturing capabilities.
As one company, we will have an enhanced financial profile grounded in attractive margins, strong free cash flow and a healthy balance sheet, that will enable us to invest in organic and inorganic growth opportunities to deliver superior returns for investors. The industrial logic and strategic rationale of bringing Quanex and Tyman together are clear and compelling, and we are confident in our ability to drive meaningful value creation for both Quanex and Tyman shareholders and enhanced market offerings for our customer base.”
Commenting on the Transaction, Nicky Hartery, Non-Executive Chair of Tyman, said: “This transformative and complementary transaction will strengthen the enlarged business for the benefit of all our customers, employees and other stakeholders. In the context of a rapidly evolving North American marketplace, our Board ultimately determined that this transaction is the best path to maximising value for Tyman Shareholders, who will be able to realise a meaningful portion of their holding in cash at a significant premium to the prevailing share price while also participating in the future upside of the enlarged group. Today marks the beginning of an exciting next chapter for Tyman and our talented employees, and we look forward to joining with Quanex to deliver future growth and success.”
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