Mexichem Eyes Dutch Pipe Maker

Mexichem has made an unsolicited offer to acquire Wavin, a Dutch plastic-pipe manufacturer, a move that the Mexican chemical company says would create the largest PVC tube maker in the world with sales of over EUR4bn. Mexichem is making a cash offer of EUR8.50 per ordinary share. Wavin confirmed it has received an “unsolicited indicative non-binding” offer for all its outstanding shares. The company has said its board will consider the proposal and has retained Bank of America Merrill Lynch (BAML) to advise in the deal. Mexichem has brought in Barclays Capital and Citigroup as financial advisors and Allen & Overy as legal advisors. Last year Wavin generated EUR1.2bn in revenues and, most recently, posted Ebitda of EUR35.8m in Q3 of 2011. In September Mexichem closed a $1bn 3-year revolver intended to provide it with the necessary resources to take advantage of acquisition opportunities. Tied to a ratings grid, the loan offered L+90bp out of the box for utilization of less than 33%, 95bp for utilization of between 33%-67% and 100bp for over 67%. Spreads tighten or widen by 20bp for each ratings notch above or below BBB minus. Leads were Bank of America, BBVA, Citigroup, HSBC, JPMorgan and Santander.