MWV Specialty Chemicals Agrees to Acquire Resitec Industria Quimica, Ltda.
Acquisition Strengthens Commitment to Pine Chemicals Business in Latin America
NORTH CHARLESTON, S.C.--(BUSINESS WIRE)-- MWV Specialty Chemicals, a division of MeadWestvaco Corporation (MWV) (NYSE: MWV), announced a definitive agreement to purchase the remaining outstanding ownership stake of Resitec Industria Quimica, Ltda., a Brazilian company that serves the Latin American Pine Chemicals industry. MWV and South Africa-based AECI Limited (JSE: AFE) have held a 50-50 joint venture partnership interest in Resitec for the past four years. The decision to move Resitec to one owner was made jointly. The agreement is contingent on final government approvals. Terms of the agreement were not disclosed.
Weve had a successful four-year joint venture partnership interest in Resitec, and we are pleased to have them join MWV as we continue to accelerate our growth in emerging markets, said Ed Rose, president, MWV Specialty Chemicals. The Resitec employees have built a strong business, and we look forward to their continued support in serving our customers. This transaction represents MWVs commitment to pine chemicals, which is core to our business in Brazil and in Latin America. We will leverage our innovative products and strong technical expertise with current customers, and in expanded markets, including oilfield, adhesives and paving solutions to profitably grow in this important region, he added.
Growth in Brazil remains an important component of AECIs strategy, said Dr. Graham Edwards, CEO of AECI. The company has reviewed and refined the details of this strategy in terms of its preferred target markets and business model. Whilst involvement in Resitec has been invaluable for acquiring local knowledge and experience as a platform for future expansion, AECI concluded that Resitec is not ideally aligned with its core strategy.
With approximately 115 employees, Resitecs operations include a manufacturing facility located in the city of Duque de Caxias, Rio de Janeiro, an administrative office located in Barra da Tijuca, Rio de Janeiro and a tall oil refinery in the city of Palmeira, Santa Catarina, Brazil. Resitec currently provides chemical products for the rubber, lubricants, food and adhesives markets, and will expand its offerings to include asphalt and oilfield markets following the acquisition.
MWV has operated in Brazil for nearly 60 years. MWV Rigesa is a leader in the Brazilian corrugated packaging market, serving customers in the fresh produce, frozen meat, consumer and industrial goods markets. MWV also provides packaging solutions for the healthcare, personal care, and beverage markets in Brazil. The company has 3,000 employees in the region and operates one paper mill, five corrugated packaging plants, one paperboard packaging plant, and 54 thousand hectares of forest plantations, with sales offices and commercial representatives strategically located nationwide.
MeadWestvaco Corporation is a global packaging company providing innovative solutions to the worlds most admired brands in the healthcare, beauty and personal care, food, beverage, home and garden, tobacco, and agricultural industries. The company also produces specialty chemicals for the automotive, energy, and infrastructure industries and maximizes the value of its land holdings through forestry operations, property development and land sales. MWVs network of 125 facilities and 16,000 employees spans North America, South America, Europe and Asia. The company has been recognized for financial performance and environmental stewardship with a place on the Dow Jones Sustainability World Index every year since 2005. Learn more at www.mwv.com.
Resitec Industrial Quimica, Ltda. is the largest producer of oleochemicals-based products in Brazil, specializing in rubber emulsifiers, adhesive resins and lubricants. It employs approximately 115 people in its manufacturing locations in Duque de Caxias, Rio de Janeiro and in Palmeira, Santa Catarina. More information about Resitec and its product offerings can be found at resitec.com.br.
AECI is an explosives and specialty chemicals company domiciled in South Africa. Group businesses service the mining and manufacturing sectors both locally and internationally. The focus for growth is on Africa, South America and South East Asia. AECIs businesses are characterised by application know-how and service delivery. They often operate in niche markets and are supported by leading technology which is developed in-house or is sourced from international partners. In the last five years the Group has invested R2 billion in a strategic capital investment programme to enhance its future growth in the mining and manufacturing areas, with particular emphasis on mining chemicals and initiating systems.
Certain statements in this document and elsewhere by management of the company that are neither reported financial results nor other historical information are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such information includes, without limitation, the business outlook, assessment of market conditions, anticipated financial and operating results, strategies, future plans, contingencies and contemplated transactions of the company. Such forward-looking statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and other factors which may cause or contribute to actual results of company operations, or the performance or achievements of each company, or industry results, to differ materially from those expressed or implied by the forward-looking statements. In addition to any such risks, uncertainties and other factors discussed elsewhere herein, risks, uncertainties, and other factors that could cause or contribute to actual results differing materially from those expressed or implied for the forward-looking statements include, but are not limited to, events or circumstances which affect the ability of MeadWestvaco to realize improvements in operating earnings from the company's ongoing cost reduction initiatives; the ability of MeadWestvaco to close announced and pending transactions, competitive pricing for the company's products; impact from inflation on raw materials, energy and other costs; fluctuations in demand and changes in production capacities; relative growth or decline in the United States and international economies; government policies and regulations, including, but not limited to those affecting the environment, climate change, tax policies and the tobacco industry; the company's continued ability to reach agreement with its unionized employees on collective bargaining agreements; the company's ability to execute its plans to divest or otherwise realize the greater value associated with its land holdings; adverse results in current or future litigation; currency movements; volatility and further deterioration of the capital markets; and other risk factors discussed in the company's Annual Report on Form 10-K for the year ended December 31, 2011, and in other filings made from time to time with the SEC. MeadWestvaco undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Investors are advised, however, to consult any further disclosures made on related subjects in the company's reports filed with the SEC.
Stephanie Mangini, +1 843-740-2166
Fulvia Putero, +27-011-806-8797
Jason Thompson, +1 804-444-2556
Source: MeadWestvaco CorporationCopyright Business Wire 2012