Apollo and ADIA to Acquire Univar Solutions

Posted on 03/15/2023

Revealed on March 14, 2023, funds managed by affiliates of Apollo Global Management, Inc. entered into a definitive merger agreement to acquire Univar Solutions Inc. (NYSE: UNVR) in an all-cash transaction that values the company at an enterprise value of approximately US$ 8.1 billion. The transaction includes a minority investment from a wholly owned subsidiary of the Abu Dhabi Investment Authority (ADIA). Univar Solutions company was founded in 1924 as Van Waters & Rogers. It was also formerly known as Royal Vopak and later Univar. Univar Solutions is a global chemical and ingredient distributor and provider of services to customers across a wide range of industries.

The agreement provides that Univar Solutions shareholders will receive US$ 36.15 per share in cash, which represents a 20.6% premium to the company’s undisturbed closing stock price on November 22, 2022. The transaction consideration also represents a premium of 33.6% to the volume-weighted average price of Univar Solutions for the 30 trading days ending on November 22, 2022. The merger agreement, which has been unanimously approved by the Univar Solutions Board of Directors, provides that Univar Solutions shareholders will receive $36.15 in cash for each share of common stock they own. The transaction will be financed with equity provided by the Apollo Funds, a minority equity investment from a wholly owned subsidiary of ADIA, and a committed debt financing package. The transaction is expected to close in the second half of 2023, subject to customary closing conditions, including approval by Univar Solutions shareholders and receipt of regulatory approvals. The transaction is not subject to a financing condition. Upon completion of the transaction, shares of Univar Solutions common stock will no longer trade on the New York Stock Exchange, and Univar Solutions will become a privately held company. Univar Solutions will continue to operate under the Univar Solutions name and brand and maintain a global presence.

Goldman Sachs & Co. LLC and Deutsche Bank Securities Inc. are serving as financial advisors to Univar Solutions and Wachtell, Lipton, Rosen & Katz is serving as lead counsel to Univar Solutions.

Paul, Weiss, Rifkind, Wharton & Garrison LLP is serving as legal counsel to the Apollo Funds.

J.P. Morgan Securities LLC is acting as lead financial advisor to Apollo. BMO Capital Markets, BNP Paribas Securities Corp., Credit Suisse, Guggenheim Securities, LLC, HSBC Securities (USA) Inc., Mizuho Securities USA LLC, RBC Capital Markets, LLC and Wells Fargo Securities, LLC are also serving as financial advisors to Apollo.

Cleary Gottlieb Steen & Hamilton LLP is serving as legal counsel to ADIA.

Clayton, Dubilier & Rice
In September 2010, Clayton, Dubilier & Rice, LLC acquired a 42.5% ownership interest in Univar, which valued the company at around US$ 4.2 billion. Funds advised by CVC Capital Partners retained a 42.5% stake in the business from the 2010 deal. At that time, Univar postponed its initial public offering of shares of its common stock.

Univar acquired U.S.-based Basic Chemical Solutions, a global distributor and trader of commodity chemicals, and the Quaron distribution business in Belgium and the Netherlands, in 2010 and 2011, respectively. In 2013, Univar moved its corporate headquarters from Redmond to Downers Grove, Illinois, a suburb of Chicago. In June 2014, Univar filed for a $100 million initial public offering. Univar completed the acquisition of Nexeo Solutions in March 2019. Nexeo Solutions had been a long-time competing chemical distributor and former division of Ashland, Inc until it was spun off in 2011. Following completion of the acquisition, Univar rebranded itself as Univar Solutions on March 1, 2019. In December 2019, Univar sold its North American Environmental Sciences division to AEA Investors.

Keywords: Apollo Management.

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