On January 8, 2025, Matthews International Corporation announced a definitive agreement to sell its interest in SGK Brand Solutions to a newly formed entity created by affiliates of SGS & Co, which will combine SGK and SGS. Matthews will receive $350 million in total upfront consideration.
The upfront consideration includes $250 million in cash at closing, $50 million of preferred equity in the new entity, and the retention of approximately $50 million in trade receivables. Additionally, Matthews will receive a 40% common equity interest in the new entity, which will have an initial enterprise value of approximately $900 million.
The cash proceeds are primarily designated for debt repayment, aiming to streamline the corporate structure and improve financial flexibility. The new entity is projected to realize over $50 million in annual run rate cost synergies, enhancing the value of Matthews' retained ownership. The transaction is expected to close by mid-2025, subject to regulatory approvals.
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