H.B. Fuller to acquire UK medical adhesives firm AMS for ~$3B in all-cash deal

the board of directors of the Company (the “Company Board”) and the board of directors of Advanced Medical Solutions Group plc (the “AMS Board”), a company incorporated in England and Wales (“AMS”), had reached agreement on the terms of a recommended cash offer by H.B. Fuller Medical Adhesive Technologies Inc., a wholly-owned subsidiary of the Company (“Bidco”), for the entire issued and to be issued share capital of AMS (the “Transaction”). ... Under the terms of the Transaction, AMS shareholders will be entitled to receive 285 pence in cash for each AMS share held.

The Secured Bridge Credit Agreement makes available to the Company certain borrowings in an aggregate amount of up to $2,086,713,188 on the terms and conditions set forth in the Secured Bridge Credit Agreement in order to, among other things, refinance certain indebtedness of the Company and to pay any fees and expenses in connection therewith, and for working capital and general corporate purposes. To the extent any borrowings are made under the Secured Bridge Credit Agreement, such loans will mature on the date that is 364 days after the closing date of the Transaction and bear interest at a per annum rate equal to an index rate plus a margin of (i) 0.75% or (ii) 1.75%, as determined therein, with interest rate increases of 0.25% per 90 days.

The Unsecured Bridge Credit Agreement makes available to the Company certain borrowings in an aggregate amount of up to $917,000,000 on the terms and conditions set forth in the Unsecured Bridge Credit Agreement in order to, among other things, partially finance the cash consideration payable by the Company in connection with the Transaction. To the extent any borrowings are made under the Unsecured Bridge Credit Agreement, such loans will mature on the date that is 364 days after the closing date of the Transaction and bear interest at a per annum rate equal to an index rate plus a margin of (i) 1.50% or (ii) 2.50%, as determined therein, with interest rate increases of 0.25% per 90 days.

The Transaction will be subject to conditions and certain further terms, including, among others: (i) the approval of the Scheme by a majority in number of AMS shareholders also representing not less than 75% in value of the AMS shares, in each case present and voting, either in person or by proxy, at the AMS shareholders’ meeting; (ii) the sanction of the Scheme by the High Court of Justice in England and Wales; (iii) the Scheme becoming effective no later than June 25, 2027 (the “Long-Stop Date”); and (iv) the receipt of regulatory approvals.

Each eligible AMS shareholder will receive £2.85 per share held in cash, which implies a total enterprise value of £715 million. The acquisition will be completed at a pre-synergy EBITDA multiple of 12.9x, based on current consensus forecast for 2026 AMS EBITDA based on IFRS, or an EBITDA multiple of less than 8x including achievement of full run-rate synergies.

H.B. Fuller expects to capture approximately $55 million or approximately £41 million in combined run-rate revenue and cost synergies by 2031, including the elimination of public company costs, rationalization of certain overlapping expenses, and sourcing savings.

H.B. Fuller has established a long-term target to achieve 5% annual constant currency revenue growth and greater than 20% EBITDA margins. AMS is expected to increase H.B. Fuller’s annual revenues by approximately $300 million, while driving positive mix shift, creating significant revenue growth and EBITDA compounding opportunities.

Consummation of the transaction is subject to AMS shareholder approval, customary closing conditions, and regulatory approvals. The transaction is expected to close by the end of the calendar year.