Mitsubishi Plastics Buys Quadrant in 50/50 Deal

06 May 2009 • by Natalie Aster

Semi-finished engineering plastics supplier Quadrant is being acquired by a 50/50 partnership formed of Japan’s Mitsubishi Plastics and a group of the company’s founders and directors. The $148m deal, priced at $76 a share, is being carried out through Aquamit, an Amsterdam-based firm.

With no anti trust issues, the deal is expected to close this summer.

The value placed on Switzerland-based Quadrant shares by the deal represents a 58% premium on the average weighted value over the past 60 days.

The two companies already collaborate through Nippon Polypenco, the $67m turnover market leader in Japan’s semi-finished engineering plastics sector. Following the current deal, Quadrant will increase its stake in NPL from 45% to 55%.

Quadrant has made two recent acquisitions in the Japanese market in composites and UHMW-PE, and according to Adrian Niggli, Quadrant chairman and co-owner of Aquamit: “Closer cooperation with Mitsubishi Plastics is beneficial to Quadrant. Mitsubishi Plastics is a global leader in manufacturing of exclusive raw materials and in R&D. This will lead to increased product innovation for Quadrant.”

Vice-president Marco Forster added: “Quadrant will benefit from the increased cooperation with Mitsubishi Plastics and its new ownership. Especially in these very difficult economic times it is an advantage for Quadrant to have strong shareholders supporting it.”

Quadrant, which turned over $647m last year, undertook a major expansion in 2002 when it acquired DSM’s Engineering Plastics Products portfolio, which included a UK facility at Welwyn Garden City, for £136m.

Mitsubishi said the plan would boost its relatively small sales in engineering plastic parts outside of Japan, while Zurich-based Quadrant said it would gain improved access to Asia and would save money by delisting from the Swiss stock exchange.

“An alliance with a prime industrial partner having a long-term view is a better option for Quadrant’s stakeholders than being raided by pure financial investors,” according to a statement from the management group and Mitsubishi.

Source: Plastics & Rubber Weekly