AZZ Closes Acquisition of Precoat Metals from Sequa Corp.

MANews-(C)2009-2022

US-based galvanizing and metal coating solutions provider AZZ Inc (NYSE: AZZ) has closed the acquisition of US-based industrial company Sequa Corp's Precoat Metals business division for a purchase price of approximately USD 1.28bn, the company said.

Sequa is a portfolio company of global investment firm Carlyle (NASDAQ: CG),

When adjusted for the net present value of approximately USD 150m of expected net tax benefits, the net purchase price is approximately USD 1.13bn, which represents approximately 8.2x Precoat's adjusted EBITDA for the twelve months ended December 31, 2021.

Headquartered in St. Louis, Missouri, Precoat is a provider of metal coil coating solutions in North America.

Precoat engages in the advanced application of protective and decorative coatings and related value-added services for steel and aluminum coil primarily serving the construction; appliance; heating, ventilation and air conditioning ; container; transportation and other end markets.

Precoat has approximately 1,100 employees and operates a network of 13 strategically located manufacturing facilities with 15 coating lines and 17 value-added processing lines.

For the twelve months ended December 31, 2021, Precoat generated revenue of approximately USD 700m and adjusted EBITDA of approximately USD 137m.

The acquisition is anticipated to be immediately and substantially accretive to AZZ's adjusted earnings per share.

Not including Precoat, AZZ upgrades its fiscal year 2022 revenue guidance to USD 890m to USD 910m and now expects to generate fiscal year 2022 earnings per share of USD 3.15 to USD 3.25, exceeding the company's prior guidance of USD 3.00 to USD 3.20.

AZZ said it...

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