UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
    

  
FORM 8-K
    

  
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of The Securities Exchange Act of 1934
  
Date of Report (Date of earliest event reported): June 17, 2016
    

  
ALBEMARLE CORPORATION
(Exact name of registrant as specified in charter)
   

     
Virginia
 
001-12658
 
54-1692118
(State or other jurisdiction
of incorporation)
 
(Commission
File Number)
 
(IRS Employer
Identification No.)
    
     
4350 Congress Street, Suite 700, Charlotte, North Carolina
 
28209
(Address of principal executive offices)
 
(Zip code)
  
Registrant’s telephone number, including area code: (980) 299-5700
  
451 Florida Street, Baton Rouge, Louisiana 70801
(Former name or former address, if changed since last report)
    

  
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
 
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 


 
 
 
 
    
Item 1.01 Entry into a Material Definitive Agreement.
 
On June 17, 2016, Albemarle Corporation (the “Company”) entered into a definitive Share Purchase Agreement (the “Purchase Agreement”) with BASF SE (the “Purchaser”), pursuant to which the Company agreed to sell its Chemetall surface treatment business (the “Business”) to the Purchaser (the “Transaction”) through a sale of the equity interests in certain indirect wholly owned subsidiaries of the Company through which the Business is operated.  The Purchase Agreement provides that the Purchaser will pay an aggregate consideration of approximately $3.2 billion in cash to acquire the Business, subject to adjustment at closing for a reduction with respect to certain underfunded and unfunded pension liabilities and further adjustment for cash, working capital and indebtedness.
 
Pursuant to the Purchase Agreement, the parties have made customary representations and warranties and agreed to various customary covenants, including, among others, covenants to conduct the Business in the ordinary course between the execution of the Purchase Agreement and the consummation of the Transaction, as well as a covenant by the Company not to compete with the Business for a period of three years following the consummation of the Transaction, subject to certain exceptions.  Pursuant to the Purchase Agreement, the Company has agreed to indemnify the Purchaser for, among other things, certain losses arising from certain pre-closing restructuring transactions and pre-closing environmental matters relating to disposed properties.  The parties also agreed to certain mutual indemnification provisions for breaches or inaccuracies in the representations and warranties or covenants.
 
The consummation of the Transaction is subject to receipt of regulatory approvals and other customary closing conditions. The Transaction is expected to close in the fourth quarter of 2016.  Either party will be permitted to terminate the Purchase Agreement if the Closing has not occurred by December 31, 2016.
 
There are no material relationships between the Company or its affiliates and the Purchaser, other than with respect to the transaction described herein.
 
Item 8.01 Other Events.
 
On June 17, 2016, the Company issued a press release announcing the Transaction.  A copy of this press release is filed as Exhibit 99.1 to this report and is incorporated herein by reference.
 
Item 9.01 Financial Statements and Exhibits.
 
(d) Exhibits
 
 
Exhibit
No.
  
 
Description
   
99.1
  
Press release, dated June 17, 2016
 
 
 
 
 

 
   
SIGNATURE
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
   
ALBEMARLE CORPORATION
 
       
       
Date: June 17, 2016
By:
/s/ Karen G. Narwold
 
   
Karen G. Narwold
 
   
Executive Vice President and Chief Administrative Officer
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
 
EXHIBITS
 
Exhibit
No.
  
Description
99.1
  
Press release, dated June 17, 2016
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

EXHIBIT 99.1
 
 

 
Press Release
 
Albemarle enters into definitive agreement to sell
Chemetall Surface Treatment business to BASF for $3.2 Billion
 
CHARLOTTE, NC, June 17, 2016 -- Albemarle Corporation (NYSE: ALB), a leader in the global specialty chemicals industry, announced today that it has signed a definitive agreement to sell its Chemetall Surface Treatment business to BASF in a cash transaction valued at approximately $3.2 billion, representing an LTM EBITDA multiple of 15.3x as of March 31, 2016.
 
Commenting on the transaction, Albemarle’s President and CEO Luke Kissam said, “The sale of Chemetall reflects Albemarle’s continued commitment to maximizing shareholder value by investing in the future growth of our high priority businesses, reducing leverage and returning capital to shareholders. I would like to thank the Chemetall management team and employees for their exceptional performance and professionalism. For BASF, the purchase of Chemetall represents a unique opportunity to acquire an industry-leading surface treatment business with a proven track record of success.”
 
The transaction is subject to regulatory approvals and other customary closing conditions and is expected to close by year end. The transaction value is subject, at closing, to reduction for certain underfunded and unfunded pension obligations and further adjustment for cash, indebtedness of the business, and variation, if any, of working capital versus a targeted amount.
 
BofA Merrill Lynch is acting as exclusive financial advisor to Albemarle and Shearman & Sterling LLP is acting as its legal advisor in connection with this transaction.

 
About Albemarle
Albemarle Corporation, headquartered in Charlotte, North Carolina, is a premier specialty chemicals company with leading positions in attractive end markets around the world. With a broad customer reach and diverse end markets, Albemarle develops, manufactures and markets technologically advanced and high value added products, including lithium and lithium compounds, bromine and bromine derivatives and catalysts used in a wide range of applications including consumer electronics, flame retardants, metal processing, plastics, contemporary and alternative transportation vehicles, refining, pharmaceuticals, agriculture, construction and custom chemistry services. Albemarle is focused on delivering differentiated, performance-based technologies that deliver innovative and sustainable solutions to its customers. The Company employs approximately 6,900 people and serves customers in approximately 100 countries.  Albemarle regularly posts information to www.albemarle.com, including notification of events, news, financial performance, investor presentations and webcasts, Regulation G reconciliations, SEC filings and other information regarding the Company, its businesses and the markets it serves.

About Chemetall
Chemetall was acquired by Albemarle as part of the acquisition of Rockwood Holdings in January 2015. The business operates under the Chemetall brand name and is a leading global supplier of applied surface treatments and services for metal, plastic and glass substrates in a wide range of industries and end markets. For the full calendar year of 2015, Chemetall generated $845 million of revenue and Adjusted EBITDA of $205 million and has approximately 2,500 employees in over 20 countries worldwide.
 
 
 

 
 
Forward-Looking Statements
Some of the information presented in this press release, including, without limitation, statements with respect to the proposed transaction between Albemarle and BASF and the anticipated consequences and benefits of the transaction, the targeted close date for the transaction, and all other information relating to matters that are not historical facts may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. There can be no assurance that actual results will not differ materially. Factors that could cause actual results to differ materially include, without limitation, the receipt and timing of necessary regulatory approvals and the other factors detailed from time to time in the reports Albemarle files with the Securities and Exchange Commission, including those described in Albemarle’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. These forward-looking statements speak only as of the date of this communication. Albemarle expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in Albemarle’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.