Saint-Gobain has sold its stake in Swiss construction chemicals maker Sika, the French company said on Wednesday, netting it 1.54 billion euros ($1.69 billion). The shares were placed via a private placement to qualified institutional investors by way of an accelerated bookbuilding process.

 

As a result of this disposal, Saint-Gobain has generated gross gains of €1.54 billion since May 2018.

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The disposal of the stake in Sika enables Saint-Gobain to strengthen its balance sheet. SaintGobain 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. 

 

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 retur 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.”