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Slide #3. Koppers — Wood Preservation and Railroad Services Businesses From Osmose
Wood Preservation and Railroad Services Businesses From Osmose
Koppers Inc., a wholly-owned subsidiary of Koppers Holdings Inc. (NYSE: KOP), has signed an agreement to acquire the Wood Preservation and Railroad Services businesses of Osmose Holdings, Inc. (Osmose), collectively, the "Acquired Businesses." The base purchase price for the Acquired Businesses is $460 million and is subject to certain closing adjustments. The base purchase price includes the value of an anticipated 338(h)(10) tax election that is expected to provide cash tax savings of approximately $7 million annually over the next 15 years. Revenues for the Acquired Businesses in 2013 were approximately $390 million. Koppers plans to finance the purchase through new and existing bank debt, including a new term loan and an increase to the company's existing revolving credit facility. The transaction is expected to close in the third quarter of 2014, subject to regulatory filings and customary closing conditions.
Koppers Holdings is a holding company. Through its subsidiaries, Co. is a provider of treated wood products, wood treatment chemicals, and carbon compounds. Co. has three segments: Railroad and Utility Products and Services, which sells treated and untreated wood products, rail joint bars and services to the railroad and the utility markets; Performance Chemicals, which supplies copper-based wood preservatives, including micronized copper quaternary and micronized copper azole, micronized pigments, alkaline copper quaternary, amine copper azole, and chromated copper arsenate; and Carbon Materials and Chemicals, which manufactures creosote, carbon pitch, naphthalene, and phthalic anhydride.
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