H.B. Fuller is pleased to welcome Royal Adhesives & Sealants and all of its associated businesses and brands to our global network. This transaction is an exciting merger of two of the world’s leading adhesives providers that will result in a more capable and dynamic company for employees, customers and shareholders.
Read the press release and expand the sections below to learn more about the acquisition.
Visit Royal Adhesives & Sealants to buy their products.
What has been announced regarding H.B. Fuller and Royal Adhesives & Sealants? | H.B. Fuller has finalized its acquisition of Royal Adhesives & Sealants, a leading manufacturer of high-value specialty adhesives and sealants, headquartered in South Bend, Indiana. This business operates 19 manufacturing facilities in 5 countries, employs more than 1,500 people globally, and generated approximately $636 million (unaudited) in revenue during the last 12 months ended June 30, 2017. |
Why does this transaction make sense for H.B. Fuller? |
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What are the terms of the deal? How much did H.B. Fuller pay? | The purchase price for the transaction is $1,575 million. The consideration will be paid in cash at closing after the issuance of a seven year term loan debt. |
Why acquire Royal versus another adhesives company? | We are very excited about this new business. It furthers our growth and margin improvement opportunities as we strive to be the best adhesives company in the world. Not only will this deal expand current net revenue by about 30 percent, but it will strengthen our portfolio and supplement our progress towards our growth and profitability goals. |
How do Royal’s products and technology fit with H.B. Fuller’s markets and growth strategy? |
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How will Royal be integrated and when will integration start? | Due to specific complexities across segments, there will be differences in the timing and level of integration, and we expect to begin this work in 2018 and complete it by December 2020. |
How does this acquisition improve H.B. Fuller’s service or value to customers? |
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What affect will this acquisition have on customers, suppliers and other partners? |
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How will Royal’s capabilities be integrated with H.B. Fuller’s commercial strategy? | We believe that Royal’s capabilities will complement H.B. Fuller’s commercial strategy. We are working closely with our new colleagues from Royal to build and implement very detailed transition plans as we learn more about each other’s business, technology and customers. We will communicate any changes as soon as information becomes available. Our first priority is to maintain our customer service levels. |
Who will lead the H.B. Fuller businesses after the acquisition? Who will manage the businesses new to H.B. Fuller? | Jim Owens will continue to lead H.B. Fuller as President and CEO. For now, all of Royal’s businesses will continue to report up to Ted Clark who will report to Jim Owens as a member of H.B. Fuller’s Executive Committee. |
Is there a risk of supply chain disruption? Can you guarantee supply of the same quality and lead times? | We are planning carefully to achieve a smooth transition to one company. We do not anticipate that the integration of our businesses will cause any disruption to our supply chain, and we are committed to continuing to deliver high-quality products and services. |
Who will manage customers’ accounts? | Customers should continue to contact their existing sales or technical support representative as they have in the past. |
What will happen to customer pricing? | We fully expect that, as part of H.B. Fuller, the Royal business will continue to provide a high level of product quality, innovation and service in exchange for a fair and competitive price. We do not expect any changes to customer pricing as a result of this acquisition. However, as both companies do today, we will manage necessary price increases due to raw material increases and market dynamics. |
Will H.B. Fuller continue to make all of Royal’s products available? |
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How will support for customers be affected? | Our first priority is to maintain our customer service levels. We anticipate that, combined, our organizations will be able to offer not only a wider range of expertise and faster support, but also a wider range of products. |
What will happen to supplier pricing? | Combined supplier pricing will be studied and negotiated in the coming months. We fully expect that pricing from our suppliers will reflect our now larger position as a buyer of adhesive raw materials. |
A More Dynamic Company
Jim Owens, President & CEO
Future Growth Opportunities
Ted Clark, Sr. VP, Royal Adhesives
Adding Value for Shareholders
Jim Owens, President & CEO
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