LSB Industries Inc on May 12, 2016 entered into a definitive agreement to sell the company’s Climate Control Business (CCB) to NIBE Industrier AB of Sweden for a total cash consideration of $ 364 million. The Climate Control Business generated approximately $ 274 million in revenue and $ 25 million in EBITDA in 2015.
Proceeds from the transaction will primarily be used to pay down debt. As a result, LSB will have greater financial flexibility and an improved capital structure to execute its growth strategies for its core chemical business, including improving the company’s chemical plant on-stream rates.
Dan Greenwell, president and CEO, LSB, stated, “This transaction represents an important milestone for LSB and our shareholders. As a focused chemicals company, our management team can now concentrate entirely on growing our chemical business by leveraging the substantial investments we have made over the last several years to enhance the reliability and profitability of our facilities. We are confident that the investments we made at El Dorado will significantly enhance our performance and look forward to the generation of strong cash flow from those facilities. Importantly, this transaction will enhance our financial flexibility and allow us to continue to invest in improving our plants.”
LSB’s principal business activities consist of the manufacture and sale of chemical products for the agricultural, mining, and industrial markets, and the manufacture and sale of commercial and residential climate control products, such as water source and geothermal heat pumps, hydronic fan coils, modular chillers, large custom air handlers and make-up air units.
