Solenis, a portfolio company of Platinum Equity, has agreed to acquire publicly traded and Bain Capital-owned Diversey Holdings in an all-cash transaction valued at an enterprise value of approximately $4.6 billion.
Diversey (NASDAQ: DSEY) provides cleaning and hygiene products to the hospitality, healthcare, food and beverage, and facility management sectors. Diversey has more than 85,000 customers in over 80 countries and has more than 9,000 global employees.
Diversey’s cleaning chemicals, equipment, and tools include robotic floor scrubbers; concentrated disinfectant cleaners used in hospitals and nursing homes; electronic hand hygiene monitoring systems used to track hand hygiene compliance; laundry detergents used in commercial and industrial laundries; and ultraviolet disinfection systems used to kill bacteria and viruses in hospitals and schools. The company, led by CEO Phil Wieland, is headquartered 20 miles south of Charlotte in Fort Mill, South Carolina.
Diversey was founded in Chicago in 1923 by August and Herbert Kochs as a division of their Victor Chemical Works cleaning products company. The division was named after nearby Diversey Avenue and became independent of Victor Chemical in 1950.
Over the ensuing decades, the company changed hands multiple times beginning with its acquisition by Molson Brewery (1978), Unilever (1996), Johnson Wax Professional (2002), Clayton, Dubilier & Rice (2009), Sealed Air (2011) and then Bain Capital (2017). Diversey went public in March 2021 and Bain Capital is currently the largest shareholder of Diversey with a 73% equity interest.
For the trailing twelve months ending in September 2022, Diversey had revenues of $2.7 billion and an adjusted EBITDA of $347 million. Based on a $4.6 billion enterprise value this equates to a 13.3x valuation multiple. In FY2021, Diversey had revenues of $2.6 billion and an adjusted EBITDA of $410 million.
Solenis is a provider of specialty chemicals – process chemicals and functional additives – used in the pulp and paper, water treatment, oil and gas, and mining industries. The company’s products include fiber and filler retention aids used in papermaking; chemical agents used to control deposits on screens, pipes, and tanks in pulp and paper mills; biocides that are used to control microbial growth in industrial water systems; scale inhibitors that prevent the buildup of mineral scale in industrial water systems; mining chemicals used for mineral processing; and oilfield chemicals including drilling fluids, and production chemicals.
Solenis operates 49 manufacturing facilities and has just over 6,500 employees. The Wilmington, Delaware-headquartered company was acquired by Platinum Equity in 2021. Post closing, Solenis CEO John Panichella will lead the combined company and Bain Capital will continue as an investor in partnership with Platinum.
“This is a strategic combination of two leading global products, services, and technologies providers with proven track records of product innovation who offer truly differentiated solutions to customers,” said Mr. Panichella. “In combining these two complementary businesses, we expect to usher in a new and exciting chapter in our long history of helping customers tackle core challenges such as water and energy management, partnering on sustainability issues to work towards a cleaner, safer world, and reducing environmental impacts. With continued support from Platinum Equity and now Bain Capital, we are confident that we’ll maximize the opportunities ahead.”
Bain Capital Private Equity was founded in 1984 and invests in the consumer and retail; financial and business services; healthcare; industrials; and technology, media, and telecommunications sectors. The firm has a team of approximately 250 investment professionals with 23 offices on four continents including offices in Boston, Chicago, New York, San Francisco, Dublin, London, Munich, Melbourne, Mumbai, Hong Kong, Shanghai, Sydney and Tokyo.
Platinum Equity invests in a range of industries including manufacturing, distribution, transportation and logistics, equipment rental, metals services, media and entertainment, technology, and telecommunications. Platinum was formed in 1995 by Tom Gores and is headquartered in Beverly Hills.
J.P. Morgan Securities and Centerview Partners are the financial advisors to Diversey, and BofA Securities, Goldman Sachs and Piper Sandler are the financial advisors to Solenis. BofA Securities and Goldman Sachs are leading the debt financing for the acquisition which is expected to close in the second half of 2023.
© 2023 Private Equity Professional | March 10, 2023
