Dutch group to add PU, acrylics coatings maker

DSM is to acquire NeoResins, the water-based coatings and inks business of Avecia, for E515m in cash. The deal is due for completion in the first quarter of 2005, subject to external approvals.

The Dutch-based maker of polyurethane and acrylic emulsions will join DSM's coating resins business within the group’s Performance Materials cluster. The 635-employee operation will trade as DSM NeoResins, a DSM statement added.

NeoResins expects 2004 sales of around E270m and earnings (Ebitda) of approximately E52m. The company is headquartered in Waalwijk, the Netherlands, and operates five sites on three continents.

With margins of around 20%, NeoResins will contribute immediately to DSM's earnings per share and profitability, according to Peter Elverding, DSM chairman. “Against this background, the multiple we will be paying for NeoResins is full but fair,” he said.