Aug. 8 (Bloomberg) -- Sika AG climbed to the highest in at least 24 years after the Swiss maker of construction chemicals said it will buy Akzo Nobel NV’s building adhesives business for 320 million francs ($348 million).
Shares rose as much as 1.8 percent to 2,685 francs in Zurich, the highest intraday level since at least 1989. Sika was trading at 2,665 francs at 2:02 p.m., giving the Baar, Switzerland-based company a market capitalization of 6.7 billion francs.
Sika expects to close the acquisition of the maker of Casco and EriKeeper glues from Amsterdam-based Akzo in the fourth quarter, it said in a statement today. The purchased business has sales of 228 million francs and 550 employees, it said.
The deal looks good from a strategic perspective “and valuation-wise too,” Patrick Laager, an analyst with Credit Suisse AG in Zurich, said in a note to investors. The acquired units are “mostly geared to premium end-markets with strong profitability probably exceeding the 12 to 14 percent Ebitda mid-term range Sika is targeting,” he said.
The acquisition will boost Sika’s position in adhesives for interior furnishing, where Akzo is the third largest supplier, Dominik Slappnig, Sika’s head of investor relations, said by phone. The purchase is one of Sika’s bigger deals since the 2005 purchase of Sarna Kunststoff Holding AG, he said.
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