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Univar's (UNVR) Buyout of Nexeo Gets Shareholders' Approval

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Univar Inc. (UNVR - Free Report) announced that its shareholders have approved all proposals associated with its acquisition of Nexeo Solutions. 

Notably, all essential regulatory approvals regarding the transaction have been obtained. The acquisition is slated to be effective on Feb 28, 2019, subject to the satisfaction of the remaining customary conditions to closing.

Univar stated that issuance of common stock related to the transactions contemplated by the earlier announced Agreement and Plan of Merger, following which the company agreed to acquire Nexeo, was approved by more than 99% votes cast at the special meeting. This represents an affirmative vote of roughly 88% of the issued and outstanding shares of Univar common stock. 

Nexeo’s major stockholders, funds affiliated with TPG Global and First Pacific Advisors, have provided the consent for the planned transaction. Also, the holders of more than 90% of Nexeo’s outstanding common stock have expressed their written consent for the deal.

Support of Univar shareholders takes the company a step closer toward its vision of creating the most valued chemical and ingredients distributor globally as well as create significant value for shareholders.

Univar’s adjusted earnings per share (EPS) of 33 cents in the fourth quarter beat the Zacks Consensus Estimate of 32 cents.

For first-quarter 2019, Univar expects to generate adjusted EBITDA of $140-$145 million and adjusted EPS of 27-29 cents.

Also, the company expects persistent weakness in global industrial markets. Foreign currency translation is also projected to lower adjusted EBITDA by roughly $6 million in the first quarter. Considering these challenges, Univar expects the first quarter to be the weakest quarter of 2019.

Zacks Rank & Key Picks

Univar currently carries a Zacks Rank #3 (Hold).

A few better-ranked stocks in the basic materials space include Kirkland Lake Gold Ltd. (KL - Free Report) , Ingevity Corporation (NGVT - Free Report) and Materion Corporation (MTRN - Free Report) , all currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Kirkland has an expected earnings growth rate of 20.9% for 2019. The company’s shares have surged 125.1% in the past year.

Ingevity has an expected earnings growth rate of 17.9% for 2019. The company’s shares have surged 49.2% in a year’s time.

Materion has an expected earnings growth rate of 12.6% for 2019. Its shares have gained 13.5% in a year’s time.

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