Vesuvius plc, a specialist in molten metal flow technology, signed an agreement on 27 February to acquire CCPI Inc., a specialty refractory producer.
CCPI focuses on tundish (steel continuous casting) applications (65% of sales) and aluminium (35% of sales). The company is based in Ohio, USA, and will become part of Vesuvius’ Advanced Refractories division. The transaction values CCPI at USD43.4 million on a cash and debt-free basis and will be funded from Vesuvius’ internal resources. The acquisition is expected to close within the first week of March.
The purchase price represents 8x 2018 Ebitda and the implied pro forma acquisition multiple is significantly lower post synergies, which are expected to be realised over the next two years. Patrick André, chief executive of Vesuvius, commented: “CCPI is a strategically important acquisition for Vesuvius, which significantly expands Vesuvius’ North American presence in refractories used in steel tundish applications, while also increasing Vesuvius’ exposure to aluminium. The financial rationale is compelling and we look forward to working with CCPI’s management team to continue its strong track record of value creation.”