AKRON, Ohio, Dec. 2 /PRNewswire-FirstCall/ -- -- Acquisition would
enhance A. Schulman's position in global rotomolding and
masterbatch markets -- Combined stock and cash transaction valued
at approximately $191.4 million -- Transaction requires approval
from ICO shareholders and customary regulatory approvals A.
Schulman, Inc. (Nasdaq-GS: SHLM) announced today that it has signed
a definitive agreement to acquire all of the outstanding stock of
ICO, Inc. (NASDAQ:ICOC), pending approval of the transaction by ICO
shareholders and receipt of customary regulatory approvals. Under
the terms of the agreement, the total consideration is comprised of
$105.0 million in cash and 5.1 million shares of A. Schulman common
stock. ICO, Inc. shareholders will receive approximately $6.79 per
share of ICO, Inc. stock, comprised of (a) approximately $3.67 per
share in cash and (b) approximately $3.12 in A. Schulman stock
(0.184 share of A. Schulman stock valued at the closing price on
December 2, 2009) assuming the cash-out of all ICO, Inc. stock
options at their "in the money" spread based on the December 2
closing price. After the merger closes, ICO, Inc. shareholders will
own approximately 16% of the combined company. The transaction is
not subject to a financing contingency. A. Schulman intends to pay
the cash portion of the purchase price out of its approximately
$230 million of cash on hand. The transaction does not acquire
approval by A. Schulman's shareholders. ICO is a global
manufacturer of specialty resins and concentrates, and provides
specialty polymer services, including size reduction, compounding
and other related services. Its products are used to manufacture
plastic bags and films, household products, toys, water tanks and
other rotational molding applications. ICO reported annual revenues
of $300 million for the year ended September 30, 2009. "We are very
excited by this proposed transaction. The acquisition of ICO
presents us with an opportunity to expand our global presence
substantially, especially in rotomolding. As we have communicated
to our shareholders in the past, A. Schulman's long-term strategic
objectives include being a leading global manufacturer in both
masterbatch and rotomolding," said Joseph M. Gingo, Chairman,
President and Chief Executive Officer of A. Schulman. "Our two
businesses are extremely complementary across markets, product
lines and geographies," Gingo said. "The addition of ICO's
masterbatch and rotomolding facilities to A. Schulman's facilities,
specialty products and technical capabilities, along with our other
combined skill sets, will strengthen our ability to serve
customers. ICO is also a global leader in size reduction, which is
a segment that A. Schulman currently does not serve, and which will
enable us to provide a wider variety of solutions to customers
throughout all of our businesses. By acquiring the operations of
ICO, we will increase our presence in the U.S. masterbatch market,
gain plants in the high-growth market of Brazil and facilities in
Australia, and add another facility in Asia to bring our total
plants in that region to four, including the facility we plan to
build in India. In Europe, the acquisition will allow us to expand
our presence and add rotomolding and size reduction to our
capabilities. It also will enable us to grow both in countries
where we currently have a limited presence, such as France, Italy
and Holland, as well as further leverage our facilities serving
high-growth markets such as Poland, Hungary and Sweden." Gingo
continued, "Going forward, ICO will have access to A. Schulman's
strong balance sheet which will help to underpin ongoing strategic
growth initiatives. We also expect to achieve approximately $15
million in run-rate synergies by the end of fiscal 2011, resulting
from the consolidation and centralization of global purchasing
activities, tax benefits, and elimination of duplicate public
company costs." For fiscal 2010, A. Schulman's preliminary
assessment, assuming a spring 2010 close, is that the acquisition
will contribute approximately $150 million to revenues and be
accretive to earnings on an operating basis. This estimate includes
the 2010 half-year effect of the synergies, ICO earnings and costs
of approximately $5.0 million to achieve the synergies, as well as
any costs associated with the transaction. "Our Board of Directors
has unanimously determined that the merger with A. Schulman, Inc.
is in the best interests of our shareholders, and that the combined
company will provide enhanced product and service offerings to our
customers and outstanding opportunities for our employees," said A.
John Knapp, Jr., President and Chief Executive Officer of ICO, Inc.
"A. Schulman is a strong global leader in the manufacture of
high-performance plastic compounds and resins, with an outstanding
management team and corporate culture. It is well-positioned to
pursue a long-term strategy of profitable growth and value creation
that is consistent with our vision at ICO, Inc. The ICO and A.
Schulman businesses are largely complementary and synergistic with
little overlap in end use and geographic markets. We have built a
great team at ICO, Inc., and during our years of working together
with A. Schulman, we have been highly impressed with the enthusiasm
and energy of their team. We believe the chemistry will be
outstanding when the integration takes place." The two companies
believe this transaction will bring significant value and
opportunity to the customers of the combined business as a result
of: -- Enhanced and complementary product offerings -- Expanded
global reach -- Increased financial strength -- Shared technology
and product development focused on better solutions for customers
ICO expects to make a subsequent announcement of the timing and
location of the meeting of shareholders and record date for
shareholders eligible to vote on the proposed acquisition. Pending
ICO shareholder and regulatory approvals and other customary
closing conditions, the transaction is expected to close in the
spring of 2010. If the transaction is closed, the agreement calls
for two current ICO directors, Gregory T. Barmore and Eugene R.
Allspach, to join the A. Schulman Board of Directors. Conference
Calls on the Web Executives from ICO will host a conference call
regarding this transaction and ICO's 2009 fourth-quarter results. A
live Internet broadcast of the conference call can be accessed at
9:00 a.m. Central time on Thursday, December 3, 2009, at
http://www.videonewswire.com/event.asp?id=64376 where the webcast
replay will be accessible for 90 days. The webcast replay will also
be accessible on the Company's website at
http://www.icopolymers.com/ for a period of 12 months. A. Schulman
also will host a conference call regarding this transaction. A live
Internet broadcast of the conference call can be accessed at 2:00
p.m. Eastern time on Thursday, December 3, on the Company's
website, http://www.aschulman.com/. An archived replay of the call
will also be available on the website. About A. Schulman, Inc.
Headquartered in Akron, Ohio, A. Schulman is a leading
international supplier of high-performance plastic compounds and
resins. These materials are used in a variety of consumer,
industrial, automotive and packaging applications. The Company
employs about 2,000 people and has 16 manufacturing facilities in
North America, Europe and Asia. Revenues for the fiscal year ended
August 31, 2009, were $1.3 billion. Additional information about A.
Schulman can be found at http://www.aschulman.com/. About ICO, Inc.
With 20 locations in nine countries, ICO produces custom polymer
powders for rotational molding and other polymer related
businesses, such as the textile, metal coating and masterbatch
markets. ICO remains an industry leader in size reduction,
compounding and other tolling services for plastic and non-plastic
materials. ICO's Bayshore Industrial subsidiary produces specialty
compounds, concentrates and additives primarily for the plastic
film industry. Additional information about ICO, Inc. can be found
on the Company's website at http://www.icopolymers.com/. "Safe
Harbor" Statement under the Private Securities Litigation Reform
Act of 1995 A number of the matters discussed in this release that
are not historical or current facts deal with potential future
circumstances and developments, in particular, information
regarding expected synergies resulting from the merger of Schulman
and ICO, combined operating and financial data, the combined
company's plans, objectives, expectations and intentions and
whether and when the transactions contemplated by the merger
agreement will be consummated. The discussion of such matters is
qualified by the inherent risks and uncertainties surrounding
future expectations generally, and also may materially differ from
actual future experience involving any one or more of such matters.
Such risks and uncertainties include: the risk that the businesses
will not be integrated successfully; the risk that the cost savings
and any other synergies from the transaction may not be fully
realized or may take longer to realize than expected; restrictions
imposed by outstanding indebtedness; fluctuations in the prices of
sources of energy or resins and other raw materials; worldwide and
regional economic, business, and political conditions, including
continuing economic uncertainties in some or all major product
markets; changes in customer demand and requirements; business
cycles and other industry conditions; the timing of new services or
facilities; ability to compete; effects of compliance with laws;
fluctuations in the value of currencies in major areas where
operations are located, including the U.S. dollar, Euro, U.K. pound
sterling, Canadian dollar, Mexican peso, Chinese yuan, and
Indonesian rupiah; matters relating to operating facilities; effect
and costs of claims (known or unknown) relating to litigation and
environmental remediation; ability to manage global inventory;
ability to develop technology and proprietary know-how; ability to
attract and retain key personnel; escalation in the cost of
providing employee health care; performance of the global
automotive market; disruption from the transaction making it more
difficult to maintain relationships with customers, employees or
suppliers; the failure to obtain governmental approvals of the
transaction on the proposed terms and schedule, and any conditions
imposed on the combined company in connection with consummation of
the merger; the failure to obtain approval of the merger by the
stockholders of ICO and the failure to satisfy various other
conditions to the closing of the merger contemplated by the merger
agreement; and the risks that are described from time to time in
Schulman's and ICO's respective reports filed with the SEC,
including Schulman's annual report on Form 10-K for the year ended
August 31, 2009 and ICO's annual report on Form 10-K for the year
ended September 30, 2008 and quarterly report on Form 10-Q for the
quarter ended June 30, 2009, in each case, as such reports may have
been amended. This release speaks only as of its date, and Schulman
and ICO each disclaims any duty to update the information herein.
Additional Information and Where to Find It In connection with the
proposed transaction, a registration statement on Form S-4 will be
filed with the SEC. ICO SHAREHOLDERS ARE ENCOURAGED TO READ THE
REGISTRATION STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED WITH
THE SEC, INCLUDING THE PROXY STATEMENT/PROSPECTUS THAT WILL BE PART
OF THE REGISTRATION STATEMENT, WHEN THEY BECOME AVAILABLE, BECAUSE
THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED MERGER.
The final proxy statement/prospectus will be mailed to shareholders
of ICO. Investors and security holders will be able to obtain the
documents free of charge at the SEC's web site,
http://www.sec.gov/, from A. Schulman, Inc. at its web site,
http://www.aschulman.com/, or from ICO, Inc. at its web site,
http://www.icopolymers.com/, or 1811 Bering Drive, Suite 200,
Houston, Texas, 77057, attention: Corporate Secretary. Participants
In Solicitation Schulman and ICO and their respective directors and
executive officers and other members of management and employees
may be deemed to be participants in the solicitation of proxies in
respect of the proposed merger. Information concerning Schulman's
participants is set forth in the proxy statement, dated November 6,
2009, for Schulman's 2009 annual meeting of stockholders as filed
with the SEC on Schedule 14A. Information concerning ICO's
participants is set forth in the proxy statement, dated January 23,
2009, for ICO's 2009 annual meeting of shareholders as filed with
the SEC on Schedule 14A. Additional information regarding the
interests of participants of Schulman and ICO in the solicitation
of proxies in respect of the proposed merger will be included in
the registration statement and proxy statement/prospectus and other
relevant materials to be filed with the SEC when they become
available. DATASOURCE: A. Schulman, Inc. CONTACT: Jennifer K.
Beeman, Director of Corporate Communications & Investor
Relations of A. Schulman, Inc., +1-330-668-7346, Web Site:
http://www.aschulman.com/
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