BDA is pleased to announce that its client AGY Hong Kong Ltd, a majority-held subsidiary of AGY Holding Corp (“AGY”), has agreed to sell its 100% equity interest in AGY Shanghai Co Ltd to Chongqing Polycomp International Corp (“CPIC”). The value of the transaction, including non-recourse debts assumed by the buyer, and associated licensing and royalty fees, is over US$40m, subject to closing adjustments. BDA and its strategic partner William Blair & Company together advised AGY on the transaction.
The closing of the transaction is subject to a number of conditions precedent, including receipt of the required government approvals and consent from the Bank of Shanghai. Subject to satisfaction or waiver of the conditions precedent, the transaction is expected to close during the third quarter of 2013.
AGY is a leading global producer of fiberglass yarns and high-strength fiberglass reinforcements used in a variety of composites applications. AGY serves a diverse range of markets including aerospace, defense, electronics and industrial. Its Shanghai operations produce a range of high-quality electronic glass fibers, such as G75, G150 and D450, for use in the global electronics industry.
Richard Jenkins, Interim CEO of AGY said: “We are very pleased to announce the agreement with CPIC to purchase our Shanghai business unit. This divestiture allows us to focus on delivering value to our customers with products produced in the US, including our fine yarns and S-2 products. We believe that this is an important step towards successfully implementing our business strategy to be a world-class producer of advanced materials.”
Drew Walker, President of AGY, added, “Despite the sale of the Shanghai division, AGY will continue to focus on the rapidly growing specialty electronics yarns markets. AGY offers a valuable and expanding product set to meet the growing demand for new high-value glass that stems from the growth of next-generation mobile communication devices.”
Jeffrey Wang, Head of BDA’s Shanghai office added, “We are pleased to have helped AGY to reach a definitive agreement with the leading Chinese fiberglass company, notwithstanding challenging conditions in the industry in Asia. This is another example of BDA’s value-add to clients divesting non-core businesses – and satisfying the interests of multiple stakeholders – through focused, global, and competitive processes.”
Ropes & Gray LLP and King & Wood Mallesons provided legal advice to AGY.
BDA Deal Team
Euan Rellie, Senior Managing Director, New York
Jeffrey Wang, Managing Director, Shanghai
Mark Webster, Managing Director, Shanghai
Jason Song, Senior Associate, Shanghai
Lilian Gu, Associate, Shanghai
AGY Holding Corp, together with its subsidiaries, engages in designing, developing, manufacturing, and marketing glass fibers for the aerospace, defense, construction, electronics, automotive, and industrial markets. Its glass fibers are used as reinforcing materials in various applications, including aircraft laminates, ballistic armor, pressure vessels, roofing membranes, insect screening, architectural fabrics, and electronics. The company also offers continuous filament mat, a glass fiber reinforcement product used as an input in the production of flat sheet laminates, marine parts, and accessories. It sells its products in the Americas, Europe, and Asia. Headquartered in Aiken, South Carolina, AGY has a sales office in Lyon, France and, in addition to its Shanghai facility, two manufacturing facilities in the US, located in South Carolina and Pennsylvania. www.agy.com
Chongqing Polycomp International Corporation manufactures and sells fiberglass products. CPIC is a subsidiary of Yunnan Yuntianhua Co Ltd, listed on the Shanghai Stock Exchange with revenues of over US$1.5bn. CPIC is located in Chongqing and manufactures in its plants in Dadukou and Changshou. It makes fiberglass products, fiberglass reinforced thermoplastic products, textile yarn, sizing and agents. CPIC offers SMC/BMC rovings, electrical industrial yarns, texturized yarns/rovings, industrial fiberglass clothes, E-glass needle mats, pultrusion materials, multi-axial fabrics, chopped strand long fiber thermoplastics, and reinforcement materials for wind energy, pipe and tank, rail transportation, and marine industrial applications. Its products are used in construction, decoration, automotive, medical and sports equipment, food packaging, aerospace, mechanical, and electronics, in China and internationally. CPIC was established in 1986. www.cpicfiber.com
Business Development Asia LLC (“BDA”) is a leader in cross-border investment banking in Asia. BDA advises on M&A, capital raising, and restructuring. BDA has been consistently owned and managed by the same team since 1996. BDA has a track record of providing independent advice to blue-chip corporate and financial sponsor clients from North America, Europe and Asia. BDA was named Investment Banking Firm of the Year by The M&A Advisor in both 2012 and 2010. BDA is headquartered in New York with offices in London, Beijing, Shanghai, Hong Kong, Mumbai, Bahrain, Seoul and Tokyo. BDA formed a partnership with William Blair & Company in 2011. www.bdapartners.com
For more information, please contact Euan Rellie in New York at +1 212 265 5300, or Jeffrey Wang or Mark Webster in Shanghai at +86 21 5407 5580.