New Mountain Capital has entered into an agreement to acquire Zep, a maker of chemical cleaning products, for $20.05 per share in cash. The transaction is valued at approximately $692 million, including net debt. The transaction is currently expected to close in the third calendar quarter of 2015.
“Zep Inc. is an industry leader with significant growth potential and fits perfectly with New Mountain Capital’s investment philosophy of investing in market leaders in sustainable growth industries,” said Matthew Holt, Managing Director of New Mountain Capital.
Zep (NYSE: ZEP) is a maker of consumable chemical packaged goods that are used to help professionals and consumers clean, maintain and protect their assets. The company sells into the transportation, industrial maintenance and repair operation (MRO), and facilities maintenance markets. Company brand names include Zep, Zep Commercial, Zep Professional, Zep Automotive, Enforcer, Misty, TimeMist, TimeWick, Country Vet, Original Bike Spirits, Blue Coral, Black Magic, Rain-X, Niagara National, FC Forward Chemicals, Rexodan, Mykal, and a number of private label brands. Zep had 2014 net sales of approximately $700 million. The company was founded in 1937 and some of its brands have been in existence since 1896. Zep is headquartered in Atlanta (www.zepinc.com).
Jefferies and KeyBanc Capital Markets are acting as financial advisors to New Mountain Capital and fully committed debt financing has been provided by their affiliates. The acquisition of Zep is not subject to a financing condition. BofA Merrill Lynch is acting as exclusive financial advisor to Zep.
New Mountain Capital currently manages private and public equity funds with over $15 billion of assets under management. The firm is an industry generalist but has specific expertise in education, health care, software, business services, logistics, specialty chemicals, federal services, media, consumer products, financial services and insurance, environmental services, infrastructure and energy. New Mountain was founded in 1999 and is headquartered in New York (www.newmountaincapital.com).
© 2015 PEPD • Private Equity’s Leading News Magazine • 4-8-15
