AXALTA COATING SYSTEMS LTD. (NYSE:AXTA) Files An 8-K Entry into a Material Definitive Agreement
Item1.01. Entry into a Material Definitive Agreement.
On April11, 2017, Axalta Coating Systems Ltd. (Axalta) entered
into an Asset Purchase Agreement (the Asset Purchase Agreement)
with The Valspar Corporation (Valspar) and, solely with respect
to certain provisions, The Sherwin-Williams Company
(Sherwin-Williams). Upon the terms and subject to the conditions
of the Asset Purchase Agreement, Axalta agreed to purchase
certain assets of Valspar constituting its North America
Industrial Wood Coatings business, including certain proprietary
rights and intellectual property owned by, or licensed to,
Valspar and certain accounts receivable, contractual rights,
personal property, real property, books and records, inventories
and other assets, as specifically set forth in the Asset Purchase
Agreement (collectively, the Purchased Assets). The Purchased
Assets comprise Valspars coating products available to customers
through its Valspar Wood or Valspar Flooring business in North
America for use in manufacturing cabinets, furniture, flooring
and building products.
The transaction contemplated by the Asset Purchase Agreement is
subject to certain closing conditions, including the consummation
of the transaction contemplated by the Agreement and Plan of
Merger, dated as of March19, 2016, by and among Valspar,
Sherwin-Williams and Viking Merger Sub, Inc., to which Valspar is
to become a wholly owned subsidiary of Sherwin-Williams (the
Sherwin-Williams Valspar Merger). Valspar is divesting the
Purchased Assets in connection with the reviews by the Federal
Trade Commission (the FTC) and Canadian Competition Bureau (the
CCB) of the Sherwin-Williams Valspar Merger, which remains
subject to FTC and CCB approvals. Axaltas acquisition of the
Purchased Assets also is subject to the FTCs and CCBs approvals
of Axalta as a buyer for such assets and potentially other
regulatory approvals. Axaltas acquisition of the Purchased Assets
is expected to occur as soon as practicable following the closing
of the Sherwin-Williams Valspar Merger.
As aggregate consideration for the Purchased Assets, Axalta will
assume certain liabilities (the Assumed Liabilities) and will pay
an amount equal to $420.0million in cash at the closing of the
contemplated transaction (subject to certain adjustments set
forth in the Asset Purchase Agreement). The Asset Purchase
Agreement contains customary representations, warranties and
covenants made by each of Valspar and Axalta, as well as
customary mutual indemnification obligations.
The Asset Purchase Agreement may be terminated under certain
circumstances, including (i)the parties mutual agreement; (ii)the
non-terminating partys material uncured breach of the Asset
Purchase Agreement; (iii)the failure of the closing to occur by
or on August11, 2017; or (iv)the failure of the parties to obtain
or receive any required consents from regulatory authorities
and/or government-sponsored entities.
The Asset Purchase Agreement contemplates the entry by the
parties into certain ancillary agreements as of the closing of
the transaction.
The foregoing description of the Asset Purchase Agreement does
not purport to be complete and is qualified in its entirety by
reference to the full text of the Asset Purchase Agreement, which
is filed as Exhibit 2.1 to this Form 8-K and is hereby
incorporated by reference in this Item 1.01.
Item7.01. Regulation FD Disclosure.
On April12, 2017, Axalta issued a press release regarding the
Asset Purchase Agreement described in Item 1.01 of this Form
8-K, which is
attached as Exhibit 99.1 and is hereby incorporated by reference
in this Item 7.01.
Item8.01.
Other Events.
Also, on April11,
2017, in connection with the Asset Purchase Agreement, Axalta
entered into a commitment letter (the Commitment Letter) with
Deutsche Bank AG New York Branch (the Commitment Party). The
Commitment Letter provides that, in connection with the
transaction contemplated by the Asset Purchase Agreement and
subject to the conditions set forth in the Commitment Letter, the
Commitment Party will commit to provide to Axalta a $420million
senior secured incremental term loan facility. The commitment is
subject to various conditions, including the execution of
definitive documentation and other customary closing
conditions.
Item9.01.
Financial Statements and Exhibits.
(d)
Exhibits
|
ExhibitNo. |
Description |
|
| 2.1 |
Asset Purchase Agreement by and between The Valspar Corporation, Axalta Coating Systems Ltd. and, solely for purposes of Section 5.1(a), 5.1(b), 5.3, 5.8, 5.13 and 10.13, The Sherwin-Williams Company, dated as of April11, 2017.* |
|
| 99.1 | Press Release dated April12, 2017. |
| * |
Schedules have been omitted to Item 601(b)(2) of Regulation S-K. The Registrant hereby undertakes to furnish supplemental copies of any of the omitted schedules upon request by the U.S. Securities and Exchange Commission. |
Cautionary
Statement Concerning Forward-Looking Statements
This current
report may contain certain forward-looking statements regarding
Axalta and its subsidiaries including those relating to the
timing and expected benefits of Axaltas acquisition of The
Valspar Corporations North America Industrial Wood Coatings
business. Forward-looking statements are based on managements
expectations as well as estimates and assumptions prepared by
management that, although they believe to be reasonable, are
inherently uncertain. These statements may involve risks and
uncertainties, including, but not limited to, the satisfaction of
the closing conditions of the transaction (including the Valspar
and Sherwin-Williams merger as well as regulatory approvals); the
parties ability to consummate the transaction on the anticipated
terms and schedule; and Axaltas ability to achieve the expected
benefits of the acquisition. Axalta undertakes no obligation to
update or revise any of the forward-looking statements contained
herein, whether as a result of new information, future events or
otherwise.
to the
requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
| AXALTA COATING SYSTEMS LTD. | ||||||
| Date: April12, 2017 | By: |
/s/ Robert W. Bryant |
||||
| Robert W. Bryant | ||||||
| Executive Vice President Chief Financial Officer |
EXHIBIT
INDEX
|
ExhibitNo. |
Description |
|
| 2.1 |
Asset Purchase Agreement by and between The Valspar Corporation, Axalta Coating Systems Ltd. and, solely for purposes of Section 5.1(a), 5.1(b), 5.3, 5.8, 5.13 and 10.13, The Sherwin-Williams Company, dated as of April11, 2017.* |
|
| 99.1 | Press Release dated April12, 2017. |
| * | Schedules have been omitted |
About AXALTA COATING SYSTEMS LTD. (NYSE:AXTA)
Axalta Coating Systems Ltd. is a holding company. The Company is a manufacturer, marketer and distributor of coatings systems primarily serving the transportation industry. Its segments include Performance Coatings and Transportation Coatings. The Company, through its Performance Coatings segment, provides liquid and powder coatings solutions to a fragmented and local customer base. The Company, through its Transportation Coatings segment, provides coating technologies to original equipment manufacturers (OEMs) of light and commercial vehicles. It develops, manufactures and supplies liquid and powder coatings for a number of applications in the industrial end market. It develops, markets and supplies a portfolio of coatings systems and color matching technologies. It offers waterborne and solventborne products and systems used by the global automotive repair industry to refinish damaged vehicles. Its brands include Voltatex, Alesta, Nap-Gard, Abcite and Imron. AXALTA COATING SYSTEMS LTD. (NYSE:AXTA) Recent Trading Information
AXALTA COATING SYSTEMS LTD. (NYSE:AXTA) closed its last trading session up +0.15 at 31.66 with 906,132 shares trading hands.