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DALLAS - Celanese Corporation (NYSE: CE), a global specialty materials and chemical company, announced today its plan to divest its Micromax® suite of products. The decision aligns with the company’s strategic objectives of cash generation and reducing debt, particularly important given the company’s current debt-to-equity ratio of 2.5. According to InvestingPro analysis, Celanese shows a strong free cash flow yield of 10%, suggesting effective cash generation capabilities.
Scott Richardson, Celanese’s president and CEO, stated that the company is committed to aggressively managing its balance sheet through asset reviews. "We are actively exploring several opportunities for cash generation, including the divestiture of the Micromax® portfolio of products," he said.
The Micromax® business, known for its advanced electronic inks and pastes, is a key supplier for high-performance electronics. It serves sectors such as aerospace, healthcare, and transportation, providing materials critical for navigation, defense, medical monitoring, and complex circuitry. The portfolio is expected to bring in over $300 million in revenue for 2025. Its products are particularly valued for their durability and performance in challenging environments and are well-positioned to capitalize on trends like wearable technology and the electric vehicle shift.
Celanese aims to focus more sharply on high-growth assets through this divestiture, which is anticipated to enhance shareholder value and cash flow. However, the sale is subject to various conditions, including board approval, regulatory clearances, and compliance with U.S. Securities and Exchange Commission requirements. There is no certainty regarding the transaction’s structure, terms, timing, or even its completion.
Morgan Stanley & Co. LLC is serving as the financial advisor, and Kirkland & Ellis LLP is providing legal counsel for the transaction.
Celanese, which reported net sales of $10.3 billion in 2024, operates globally and employs over 11,000 people. The company is known for its contributions to sustainability and community impact, as well as for fostering inclusivity within its teams. Despite recent market challenges that led to a significant stock price decline over the past year, InvestingPro maintains additional insights about Celanese’s financial health and growth potential, with over 12 exclusive ProTips available for subscribers.
This move to divest the Micromax® product line is based on a press release statement from Celanese Corporation.
In other recent news, Celanese Corporation has made significant financial moves and adjustments. The company has announced the issuance of senior notes totaling $1.8 billion, with offerings including $700 million in 6.500% Senior Notes due 2030 and $1.1 billion in 6.750% Senior Notes due 2033. Additionally, Celanese plans to increase prices for several chemical products, including vinyl acetate monomer and vinyl-based emulsions, in the Western Hemisphere. These price changes, set to take effect in March 2025, reflect market condition adjustments.
Furthermore, Celanese has amended its bylaws to designate specific courts for legal proceedings related to securities laws, potentially streamlining litigation processes. Analyst firms have also adjusted their outlooks on Celanese, with Piper Sandler reducing its price target to $48 and maintaining an Underweight rating due to concerns about tariffs affecting revenue and earnings. Evercore ISI, on the other hand, lowered its price target to $75 while maintaining an In Line rating, noting potential upside due to improved company visibility and extended debt maturities.
These developments highlight Celanese’s strategic financial management and responses to market conditions and regulatory environments. Investors may find these changes significant as the company navigates its financial and operational landscape.
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