GCP Applied Technologies Completes Sale of Darex and Announces Realignment Plan
CAMBRIDGE, Mass., (GLOBE NEWSWIRE) -- GCP Applied Technologies Inc. (NYSE:GCP) has completed the sale of its Darex Packaging Technologies segment to Henkel for approximately $1.05 billion. Net proceeds excluding deal costs are expected to be approximately $800 million. The transaction was initially announced on March 2, 2017.
“We are pleased to have completed the sale of Darex and are now focused on GCP’s realignment to a construction products technologies company. Proceeds from the sale will provide the flexibility to strengthen our balance sheet and execute on our growth plan, which includes investing in internal product and technology development programs, as well as pursuing bolt-on acquisition opportunities,” said President and Chief Executive Officer Gregory E. Poling.
In conjunction with the Darex sale, the Company announced today that its Board of Directors has approved a business realignment plan that includes actions to reduce costs, including stranded costs associated with the Darex business and the transition of GCP to a construction products technologies company. GCP expects the plan to result in net annualized savings of approximately $22 million to $25 million.
The Company expects to incur total costs of $22 million to $26 million associated with the plan, of which approximately $16 million is expected to be incurred in the second quarter of 2017. These costs consist primarily of headcount reductions and related expenses. The realignment actions are expected to be completed by the end of 2018.
GCP expects to release its second quarter 2017 results on Thursday, August 3, 2017.