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19th December 2017, St. Paul, MN

H.B. Fuller poised for global growth

H.B. Fuller, a leading adhesives provider, has finalised its acquisition of Royal Adhesives & Sealants for US$ 1.575 billion. The company, combined with Royal, deepens its expertise in specialty and high-value applications used in a range of sectors, including electronics, hygiene, medical, transportation, clean energy, construction, and more.

“This is an exciting step for Royal and our network of brands,” said Royal Adhesives & Sealants CEO, Ted Clark. “Combining these two businesses creates a more capable and dynamic company for our customers and employees. We complement each other, selling in adjacent markets with very little customer overlap, and that presents an interesting number of growth opportunities. We offer different technologies, expertise and capabilities. Yet, we share the same passion for solving product development challenges by discovering and applying innovations in adhesive technology.”

H.B. Fuller has acquired Royal from affiliates of American Securities LLC, based in New York with an office in Shanghai. © H.B. Fuller

The acquisition expands H.B. Fuller’s product offering in engineering, durable assembly and construction adhesives and makes H.B. Fuller the world’s largest supplier of adhesives for insulating glass and commercial roofing applications. Of the top adhesives manufacturers, H.B. Fuller is the only one singularly focused on adhesive and sealant technologies.

Broader portfolio

“We are passionate about being the best adhesives provider in the world, and we’ve been investing significantly over the last decade to make it a reality,” said H.B. Fuller CEO Jim Owens. “With complementary adhesives expertise from Royal, we’re able to make an even bigger impact on improving people’s lives. Our customers will benefit from a broader portfolio and expanded development and production capabilities. We’ll be a more capable and dynamic company with additional opportunities for the thousands of dedicated H.B. Fuller and Royal employees around the world. And, the acquisition accelerates our business strategy and positions us to exceed our 2020 targets.”

H.B. Fuller also expects the combined businesses to deliver very strong cash flow to pay down debt at an accelerated pace. “With this acquisition, we have created immediate value for shareholders based on Royal’s solid organic growth track record, high EBITDA margin and strong rate of cash flow conversion. Looking ahead, we will now begin our planned three-year integration, including leveraging the US$ 15 million in growth synergies and US$ 35 million in cost synergies we identified prior to closing this transaction,” added Mr Owens.

Highly specified adhesive technology

With the addition of Royal, H.B. Fuller will be able to add more value to its customers in key markets that require highly specified adhesive technology.

From engineered wood applications and panel lamination to advancements in insulating glass, H.B. Fuller now has one of the world’s most complete lines of durable assembly adhesive offerings. The acquisition also nearly doubles the size of H.B. Fuller’s construction adhesives portfolio. Adding to H.B. Fuller’s expertise in tile setting and flooring installation, Royal is the market leader in the commercial low-slope roofing category.

www.hbfuller.com

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