Specialty chemicals and advanced materials company
Rockwood Holdings, Inc.
) has closed the earlier announced divestiture of its advanced
ceramics business "CeramTec" to private equity firm Cinven for
€1.49 billion (roughly $2 billion). The company received net cash
proceeds of $1.75 billion from the sale.
Germany-based CeramTec makes high performance advanced
ceramics materials and products for medical, electronics,
industrial and automotive markets with 18 facilities globally.
The entity has strong foothold in a number of niche markets such
as medical products, cutting tools and mechanical
The divestiture is in line with Rockwood's goal to become a
more focused specialty chemical company. The company plans to use
the net proceeds from the sale to pare debt, return capital to
shareholders and re-invest in core businesses.
Rockwood, in Aug 2013, released its second-quarter 2013
results. Its profit, as reported, skid 86% year over year to
$32.3 million or 41 cents per share in the quarter, hurt by
charges associated with sale of non-core assets, especially
advanced ceramics and clay-based additives, and lower earnings
from the Titanium Dioxide (TiO2) Pigments division. Adjusted
earnings of 73 cents per share missed the Zacks Consensus
Estimate by 3 cents.
Net sales rose 7.8% year over year to $822.3 million in the
reported quarter. Consolidated sales (including discontinued
operations) rose 7.4% to $972.3 million. By that measure, it beat
the Zacks Consensus Estimate of $948 million.
Revenues from the Advanced Ceramics segment, which has been
classified as discontinued operation, went up 5% to $150 million
on higher volumes of medical ceramics.
Rockwood expects continued growth and strong margins in its
lithium and surface treatment businesses in the back half of
2013. It also sees its TiO2 pigments business to achieve a
turnaround in the second half.
Rockwood remains focused on optimizing free cash flows and
implementing appropriate capital allocation strategies through
dividends and share repurchases and reinvestment in key
businesses in 2013.
Rockwood currently holds a Zacks Rank #5 (Strong Sell).
Other companies in the specialty chemical space with favorabe
Zacks Rank are
Minerals Technologies Inc.
Sensient Technologies Corp.
). While Ferro retains a Zacks Rank #1 (Strong Buy), Minerals
Technologies and Sensient Technologies retain a Zacks Rank #2
FERRO CORP (FOE): Free Stock Analysis Report
MINERAL TECH (MTX): Free Stock Analysis
ROCKWOOD HLDGS (ROC): Free Stock Analysis
SENSIENT TECH (SXT): Free Stock Analysis
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