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Hercules to sell 51% stake in FiberVisions LLC

01 Feb '06
3 min read

Hercules Incorporated has announced an agreement to sell a 51 percent interest in FiberVisions LLC, a wholly-owned subsidiary of the company, to Snow, Phipps & Guggenheim LP, an affiliate of SPG Partners LLC, a New York-based private equity firm.

Under terms of the agreement, Hercules will receive an initial cash distribution of $109 million at closing for its 51 percent interest. SPG has an option to purchase an additional 14 percent interest in FiberVisions for $7.4 million. Also under the agreement, it will receive additional payments should FiberVisions meet certain performance measures.

Craig Rogerson, President and Chief Executive Officer of Hercules, said, "Our decision to sell a majority stake in FiberVisions reflects our strategy to invest in growth opportunities in our Aqualon and Paper Technology franchise businesses, reduce earnings volatility and further deliver our balance sheet."

"We will maintain a significant minority position in FiberVisions to share in the profitability upside as raw material costs moderate and new products under development are commercialized," he said.

"We are pleased to have an investor with the reputation and capabilities of SPG. This is a positive development for FiberVisions, its employees, partners and the customers they serve. Through SPG's involvement, FiberVisions will be able to accelerate the development and growth of its business," added Rogerson.

"We are excited to be investingin FiberVisions, and we are pleased that Hercules will continue to play a role as an investor and strategic partner in the business going forward," said Ian Snow, managing member of SPG.

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