April 1, 2021
Lintec Announces the Acquisition of Duramark Products, Inc. in the United States
Lintec Corporation (hereinafter "Lintec") announced today the results of talks with investors in Duramark Products, Inc. (headquartered in South Carolina, USA; hereinafter "Duramark") regarding the Lintec Group acquiring all shares of Duramark, a manufacturer and distributor of various adhesive products.
At a meeting today, the board of directors passed a resolution to acquire all shares of Duramark and decided to carry out a transfer agreement with Duramark's investors on April 1, 2021 (US time). The shares will be acquired through Morgan Adhesives Company, LLC, headquartered in Ohio, USA. Morgan Adhesives Company, LLC is a wholly owned subsidiary of Mactac Americas, LLC (hereinafter "Mactac," also headquartered in Ohio, USA), which is a wholly owned subsidiary of Lintec USA Holding, Inc.*
- Lintec USA Holding, Inc. is a wholly owned subsidiary of Lintec.
1. Reason for the Acquisition of Shares
The Lintec Group has been moving forward with the globalization of its business based on the concept of local production, manufacturing products in locations that are closer to its customers and providing them with a stable supply. Notably, in North America, in December 2016 the Group acquired Mactac, a manufacturer and distributor of adhesive papers and films for labels, and graphic films, thereby strengthening and expanding its Printing & Variable Information Products Operations and Industrial & Material Operations, which are the Group's core businesses.
Duramark's business operations span adhesive papers and films for labels, and graphic films, mainly provided to customers in North America. The acquisition provides immediate access to production equipment that Mactac requires to increase the production capacity of adhesive papers and films for labels, its main products. In addition, the introduction of the Duramark-owned integrated production system for graphic films, as well as in-house production, will greatly help to acquire new commercial rights and expand sales. Lintec plans to strengthen and expand its business not only in North America but also in Japan and other regions.
2. Overview of the Subsidiary to Be Transferred
| (1) Name | Duramark Products, Inc. | ||
|---|---|---|---|
| (2) Address | 1896 Moore Duncan Hwy, Moore, South Carolina 29369 USA | ||
| (3) Title and name of representative | CEO: Lucio Siano | ||
| (4) Business description | Manufacture and sale of adhesive papers and films for labels, graphic films, etc. | ||
| (5) Capital | US$10 * | ||
| (6) Established | December 9, 1983 | ||
| (7) Investor and equity ratio | Common stock Duramark Products Holding, Inc. (1,000 shares, 100%) |
||
| (8) Relationship between Lintec and the company concerned | There is no capital, personal or business relationship. | ||
| (9) Results and financial position for the last three years of the company concerned | |||
| Fiscal year | Ended December 2017 | Ended December 2018 | Ended December 2019 |
| Net assets | US$50 million | US$17 million | (US$14 million) |
| Total assets | US$137 million | US$134 million | US$120 million |
| Net sales | US$77 million | US$72 million | US$72 million |
| Operating income | (US$4 million) | (US$29 million) | (US$25 million) |
| Net income | (US$3 million) | (US$33 million) | (US$30 million) |
- After the acquisition, Duramark's capital will be equivalent to the trading value of the shares, and the company will become a specified subsidiary of Lintec.
3. Overview of the Share Acquisition Partner
| (1) Name | Duramark Products Holding, Inc. |
|---|---|
| (2) Address | Corporation Trust Center, 1209 North Orange Street, Wilmington, Delaware 19801 USA |
| (3) Relationship with Lintec | There is no capital, personal or business relationship. |
4. Share Acquisition Ratio and Share Ownership Ratio before and after Acquisition
| (1) Share ownership ratio before transfer | - |
|---|---|
| (2) Acquisition share ratio | 100% |
| (3) Acquisition price | Trading value of the shares: About US$60 million Advisory fees, etc.: About US$1 million |
| (4) Share ownership ratio after transfer | 100% |
5. Schedule
| (1) Date of board of directors'resolution | April 1, 2021 |
|---|---|
| (2) Date of the conclusion of share transfer agreement | Scheduled for April 1, 2021 (local time) |
| (3) Closing (stock acquisition date) | Scheduled for April 1, 2021 (local time) |
- The closing (stock acquisition date) shall occur after the transfer agreement conditions have been met.
6. Future Outlook
The funds for the acquisition will be appropriated from Lintec's cash reserves. Furthermore, the acquisition will have no impact on the consolidated financial results of Lintec for the fiscal year ended March 31, 2021. Lintec will closely examine its impact on its consolidated financial results for the fiscal year ending March 31, 2022 and will promptly disclose any matters that require disclosure.
The contents of the News Release are as of the announcement date. Please note that they may differ from the latest information.