The Belgian chemical group Solvay is buying U.S.-based Cytec for $5.5 billion in an effort to become a more powerful player in the production of light-weight materials for planes and cars.
Solvay will pay $75.25 per share for Cytec in cash, representing a premium of 28.9% over Cytec’s last closing price. The deal is expected to strengthen Solvay’s mining chemicals business. Cytec generated revenue of around $2 billion last year, largely from the production of composite materials for aircraft and cars.
“This acquisition will create value for our stakeholders and will support our ambition to become a leader in sustainable chemistry. This transaction will lead us to further accelerate our transformation,” said Jean-Pierre Clamadieu, CEO of Solvay, in a company statement.
The deal will help Solvay gain a foothold in the fast-growing aerospace industry, something Clamadieu has said represents an opportunity too good to ignore. “We do believe that getting a position in aerospace – it’s the second global supplier of advanced material into aerospace – is very attractive for a company like us,” the CEO said in an interview with CNBC. “We have a small position in aerospace, but the willingness to become much stronger, and Cytec gives us this opportunity.”