Platform Holdings to acquire MacDermid for $1.8 billion (updated)

10:05 AM | October 11, 2013 | Francinia Protti-Alvarez

Investment company Platform Acquisition Holdings has reached a deal to acquire specialty chemical maker MacDermid (Denver) for $1.8 billion.

Platform, formed by Jarden executive chairman Martin Franklin, raised $900 million in an initial public offering (IPO) on the London Stock Exchange (LSE) in May with the goal of acquiring a target company in an unspecified industry. The MacDermid acquisition is expected to close by the end of October.

Platform will be renamed Platform Specialty Products (PSP) and expects to complete a listing of shares on the New York Stock Exchange (NYSE) by the end of 2013. Platform's shares and warrants have been suspended from trading on the LSE, and trading is not expected to resume. Platform’s LSE listing is expected to be cancelled on or shortly after the NYSE listing.

Franklin will serve as PSP's chairman. MacDermid's current chairman and CEO Daniel Leever will become PSP's CEO and vice chairman.

MacDermid posted $742 million in sales and adjusted Ebitda of $180 million for the 12-month period ended 30 September, Platform says. MacDermid had an estimated adjusted Ebitda margin of 24.3% over the same period, Platform says.

"As we look to build a portfolio of market-leading specialty chemicals businesses, MacDermid is a natural choice to serve as the initial investment and foundation for Platform Specialty Products,” Franklin says. “MacDermid's heritage and market presence make it a leader within the sector, and this transaction will provide the company with the tools and resources necessary to reach the next level of success."

MacDermid’s performance materials unit, which accounts for roughly 75% of sales, is a leading producer of specialty chemicals for plating and surface coatings, printed circuit boards and other electronic applications, and hydraulic control fluids. The company’s graphic solutions business, which accounts for about a quarter of overall sales, is a leading producer of photopolymers used to produce printing plates for transferring images onto commercial packaging

MacDermid was taken private in April 2007 by Court Square Capital Partners (New York) and Weston Presidio (Boston) as part of a $1.3-billion leveraged buyout led by Leever. Court Square owns 70% of the common shares in MacDermid, Weston Presidio 16%, and MacDermid management 14%. MacDermid filed plans for an IPO in July 2011, but withdrew the registration in March 2013 citing "public market conditions."

Barclays acted as financial adviser, and Greenberg Traurig acted as legal adviser to Platform on the transaction. Lazard acted as financial adviser to MacDermid.