Carlyle to invest $4.9bn to acquire DuPont coatings business
US-based global alternative asset manager The Carlyle Group will invest $4.9bn in cash to acquire DuPont Performance Coatings (DPC) from DuPont.
DPC is a supplier of vehicle and industrial coating systems with more than 11,000 employees across the globe, which Carlyle said is expected to post sales of more than $4bn in 2012 financial year.
Ellen Kullman, DuPont chair and CEO, said the company has reviewed and determined that the sale would realise DPC's growth in full potential.
"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," Kullman added.
"We will continue to work closely with automotive customers to apply our science-powered innovations related to light weighting of vehicles, revolutionary and environmentally-friendly refrigerants, biobased seat fabrics and headliners, and next-generation biofuels."
Greg Ledford, Carlyle managing director and head of the Industrial and Transportation team, said the acquisition will work towards realising DPC's potential that comprises market positions, advanced technology and established products.
"Through targeted investments we will support DPC's product development and growth objectives as it transitions to a stand-alone company," Ledford added.
With the acquisition, Carlyle is looking to accelerate its growth in emerging markets such as China and Brazil.
Carlyle said that the the trasaction, which will be funded by equity from Carlyle Partners V and Carlyle Europe Partners III, is slated to be finalised in the first quarter 2013.
Both firms have signed an agreement for the acquisition, which will offer $250m of DuPont's unfunded pension liabilities to Carlyle, while DuPont will spend the sale outcome in line with its cash deployment principles.
Carlyle's industrial and automotive investments include Allison Transmission, Hertz and PQ Corporation and Hamilton Sundstrand Industrial, Sunoco's Philadelphia refinery and regional rail freight operator Genesee & Wyoming.