Sealed Air Completes Acquisition of Diversey Holdings, Inc.
Creates New Global Leader in Food Safety and Security,
Facility Hygiene and Product Protection
ELMWOOD PARK, N.J., Monday, October 3, 2011 - Sealed Air Corporation
(NYSE:SEE) announced today that it has completed its previously announced acquisition of
Diversey Holdings, Inc. ("Diversey"), a leading solutions provider to the global cleaning and
sanitation market. Under the terms of the agreement, Diversey shareholders will receive $2.1
billion in cash and 31.7 million shares of Sealed Air common stock valued at $16.70 per share
for a total consideration to shareholders of $2.6 billion. Diversey, based in Sturtevant,
Wisconsin, with approximately 10,000 employees and 2010 net sales of $3.1 billion, joins Sealed
Air as a reportable segment. The leadership teams of both Diversey and Sealed Air will remain
in their roles as integration planning continues.
The acquisition brings together two complementary, leading global organizations focused
on protection. Sealed Air now offers the most comprehensive portfolio of solutions and industry
expertise in food safety and security, facility hygiene and product protection. Broader
capabilities expand our ability to develop inventive end-to-end solutions for the food processing
and food service industries, and we can now scale R&D resources, technologies and growth
initiatives across a broader range of customers, geographies and applications. Further, we expect
to achieve operational cost efficiencies and incremental growth opportunities in industrial and
commercial sectors, which use shared distribution channels to reach similar customers.
"I am pleased to formally welcome Diversey's leadership team and employees to Sealed
Air," stated William V. Hickey, President and Chief Executive Officer of Sealed Air. "Today
marks the beginning of an exciting new era of opportunity for Sealed Air, our employees, and the
customers we serve. We are now a global leader in protection with inventive solutions in food
safety and security, facility hygiene and product packaging that protect what we eat and drink,
where we go, and the valuable goods we ship. We commit to deliver solutions that improve
safety, efficiency and sustainability using our extensive infrastructure, world class manufacturing
principles, expanded R&D capabilities and the tremendous expertise of our global team. We are
excited to bring forward innovative solutions that will create measurable value for our customers,
enhance the quality of life for consumers, and provide a cleaner and healthier environment for
future generations."
Financial Matters
loan facilities and a new revolving credit facility with a weighted average cost of debt at
closing of 5.8%. Our total weighted average cost of new and existing debt at closing,
excluding non-cash interest expense items such as the W. R. Grace settlement, is 6.2%. Our
new senior secured facilities include:
Japanese yen, Canadian dollars and euros and bears interest at LIBOR or
equivalent rate in the relevant currency plus 250 basis points (bps) per annum.
These loans were sold to investors at 100.0% of their aggregate principal amounts;
interest at LIBOR plus 375 bps per annum and a U.S. dollar-equivalent 405
million component at EURIBOR plus 450 bps per annum. LIBOR and EURIBOR
under this loan are subject to a 1.0% floor. The U.S. dollar and euro loans were
sold to investors at 98.0% and 97.0% of their respective principal amounts; and
available in multiple currencies, and bears interest at LIBOR plus 250 bps per
annum.
Additionally, we completed our offering of $750 million aggregate principal amount of
8.125% senior notes due 2019 and $750 million aggregate principal amount of 8.375% senior
notes due 2021 (collectively the "Notes"). The Notes were sold to investors at 100.0% of
their aggregate principal amount.
We used the net proceeds from the term loans and the offering of the Notes to finance a
portion of the acquisition and related fees and expenses. The revolving credit facility replaces
our previous $700 million global revolving credit facility and our Euros150 million European
credit facility, which were terminated today.
The Notes and related guarantees have been offered only to qualified institutional buyers
under Rule 144A of the Securities Act of 1933, as amended (the "Securities Act"), and to
non-U.S. persons in transactions outside the United States under Regulation S of the
Securities Act. The Notes have not been registered under the Securities Act, and, unless so
registered, may not be offered or sold in the United States absent registration or an applicable
exemption form, or in a transaction not subject to, the registration requirements of the
Securities Act and other applicable securities laws.
$263 million to purchase preferred stock of Diversey Holdings, Inc. (the "Preferred Stock
Issuance").
Diversey Holdings, Inc. elected to exercise its covenant defeasance option with respect to its
10.50% senior notes due 2020 (the "DHI Notes") and Diversey, Inc. elected to exercise its
covenant defeasance option with respect to its 8.25% senior notes due 2019 (the "DI Notes").
In addition, Diversey Holdings, Inc. elected to redeem 35% of the aggregate accreted value
of the DHI Notes using a portion of the proceeds of the Preferred Stock Issuance and
Diversey, Inc. elected to redeem 35% of the aggregate principal amount of the DI Notes
using a portion of the proceeds of the Preferred Stock Issuance that had been contributed to
the equity capital of Diversey, Inc. Each such redemption will occur on November 2, 2011
(the "Redemption Date").
On the Redemption Date, 35% of the DHI Notes will be redeemed at a price of 110.50% of
their accreted value, plus accrued and unpaid interest to the Redemption Date. Additionally,
35% of the DI Notes will be redeemed at a price of 108.25% of their principal amount, plus
accrued and unpaid interest to the Redemption Date. Following the completion of these
redemptions on the Redemption Date, we expect that Diversey Holdings, Inc. and Diversey,
Inc. will redeem the remainder of the DHI Notes and the DI Notes pursuant to the makewhole
redemption provisions of the indentures governing the DHI Notes and the DI Notes.
net earnings impact of the Diversey transaction from our full year 2011 non-U.S. GAAP
Adjusted EPS guidance range. Our full year EPS guidance excludes Diversey financial
results for the fourth quarter of 2011, acquisition costs relating to advisory, consulting, legal
and appraisal fees, integration costs, financing fees and interest expense on the debt issued to
finance the Diversey acquisition and to repay Diversey's debt, and the issuance of 31.7
million shares of our common stock as part of the total consideration for the transaction.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor
shall there be any sale of the Notes, in any jurisdiction in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under the securities laws of any such
jurisdiction.
Business
Sealed Air is the new global leader in food safety and security, facility hygiene and
product protection. With widely recognized and inventive brands such as Bubble Wrap® brand
cushioning, Cryovac® brand food packaging solutions and Diversey® brand cleaning and hygiene
solutions, Sealed Air offers efficient and sustainable solutions that create business value for
customers, enhance the quality of life for consumers and provide a cleaner and healthier
environment for future generations. On a pro forma basis, Sealed Air generated revenue of $7.6
billion in 2010 and has approximately 26,000 employees who serve customers in 175 countries.
To learn more, visit www.sealedair.com.
