Saint-Gobain announced the completion of sale of its stake in Sika held by its subsidiary Schenker-Winkler Holding AG, netting it 1.54 billion euros ($1.69 billion).
Saint-Gobain acquired its 10.75% stake in Sika as part of a global agreement with Sika and the Burkard family in May 2018. The Sika shares were held as an equity investment and Saint-Gobain has chosen to recognize any change in the fair value of the Sika shares directly in equity.
The deal was subject to a two-year stock lockup, which elapsed this month.
Saint-Gobain sold 15.2 million shares through a private placement to institutional investors for 2.56 billion Swiss francs ($2.64 billion). The deal meant it made a profit of 1.54 billion euros ($1.69 billion) since May 2018.
The disposal of the stake in Sika enables Saint-Gobain to strengthen its balance sheet.
Pierre-André de Chalendar, Chairman and Chief Executive Officer of Saint-Gobain, commented: “The Sika shareholding has been an outstanding investment for Saint-Gobain over the past two years. We have completed the sale at a price of CHF2.56 billion, equivalent to around €2.41 billion, compared to a purchase price of €933 million in May 2018. Realizing such an outstanding return on this investment is a very positive development for the Group.”
“The proceeds from the disposal will strengthen Saint-Gobain’s balance sheet, increase its financial flexibility and liquidity position in a market environment that remains uncertain. As mentioned at the end of April, depending on how the situation evolves Saint-Gobain will review the Group’s shareholder return policy by the end of the year,” he added.