Sealed Air to spin-off Diversey Care in 2017

By Joseph James Whitworth

- Last updated on GMT


Related tags Stock

Sealed Air is to spin-off Diversey Care and the related hygiene business by the second half of 2017.

The Diversey Care division and the food hygiene and cleaning business within its Food Care division (“New Diversey”) would be led by Dr Ilham Kadri, president of Diversey Care.

Sealed Air’s shareholders would own 100% of the common stock of New Diversey following the spin-off.

The company is planning the internal separation of the New Diversey business lines from the remaining entity in transactions intended to be tax efficient from a US and foreign perspective.

Spin-off value

The plan is intended to allow the remaining Sealed Air business and New Diversey to focus on strategic objectives.

Both will benefit from leaner, more streamlined operating structures to enable more efficient management decision-making, said Sealed Air.

Diversey Care’s portfolio includes the Internet of Clean, Intellibot robotics, plant-based biodegradable chemistries and AHP disinfection technologies.

Jerome A. Peribere, Sealed Air’s president and CEO, said: “Our board and management team continually evaluate options to enhance shareholder value and we believe this spin-off will allow both New Sealed Air and New Diversey to realize their full potential.

“Following the spin-off, each company will be well-positioned for profitable growth through a proven business model and enhanced strategic focus, improved operating efficiencies and optimized capital allocation to enable investments in new disruptive technologies.”

Sealed Air sold Diversey Japan to The Carlyle Group for $377m to focus on higher growth markets in 2012.

The firm bought Diversey, which serves brewers, beverage bottlers, dairies and food processors, for $4.3bn in 2011.

New business structure

Sealed Air will continue to provide food and product packaging and be led by Peribere and its existing management team.

The company has 23,000 employees who serve customers in 169 countries.

On a pro forma basis for the twelve months ended June 30, 2016, New Sealed Air (excluding New Diversey) generated $4.2bn in sales and had adjusted EBITDA of $826m.

New Diversey will be a hygiene and cleaning company with a product offering of floor care machines, tools, chemicals and services.

On a pro forma basis for the twelve months ended June 30, 2016, New Diversey generated $2.6bn in sales and had adjusted EBITDA of $305m.

The firm said it would be well-positioned to expand relationships with existing partners, develop new ones and grow brands into new channels in the US and globally.

Additional members of the management team and Board of Directors will be named in the months leading up to completion of the spin-off.

The transaction is subject to approval by Sealed Air’s Board of Directors, satisfaction of customary conditions, including the appropriate filings with the US Securities and Exchange Commission.

Sealed Air has a conference call and webcast to discuss its Q3 results and the spin-off at 11am (ET) on October 27.

Related news

Related product

Become an IDDBA Member and connect with your industry

Become an IDDBA Member and connect with your industry

Content provided by International Dairy Bakery Association | 14-Mar-2023 | Product Presentation

At IDDBA, we are retailers, manufacturers, wholesalers, brokers, and distributors in an industry that is ever-evolving.

Related suppliers