Lydall To Buy Industrial Filtration Firm MGF Gutsche For $58 Mln Cash

(RTTNews) - Lydall Inc (LDL), an industrial machinery manufacturer, announced Wednesday that it has entered into an agreement to acquire MGF Gutsche GmbH & Co. KG, an industrial filtration and technical materials company, for approximately $58 million in cash.

The transaction is expected to close at year end, subject to receipt of customary merger control approval from German competition authorities and the completion of specified closing conditions.

The acquisition will be dilutive to Lydall's earnings in 2017 on an all-in basis, and accretive to earnings by mid-2018.

Lydall expects the business to be fully integrated by the end of 2019.

The company expects the acquisition will expand its filtration product offerings into attractive adjacencies and diversify its geographic revenue base.

Gutsche is a producer of nonwoven needle punch materials serving the industrial filtration and high performance nonwoven segments, with operations in Germany and China. For the year 2016, Gutsche expects revenue and EBITDA to be approximately $50 million and $6 million, respectively.

Following the deal, Gutsche will be integrated into Lydall's Technical Nonwovens segment. The Company plans to maintain manufacturing presence in the UK, Europe, and China and, through restructuring initiatives.

The transaction is expected to be financed through a combination of cash on hand and borrowings from the Company's revolving credit facility.