Hillenbrand Transitions Majority Control of Milacron to Bain Capital
Hillenbrand Sells Majority Stake in Milacron to Bain Capital
Hillenbrand, Inc. (NYSE: HI) has successfully finalized the sale of its majority stake in the Milacron injection molding and extrusion business to Bain Capital. This significant transaction, worth approximately $287 million, reflects Hillenbrand's commitment to refining its business strategy and enhancing its core operations.
Insight into the Sale
With Bain Capital now holding an estimated 51% stake in Milacron, it assumes full operational control over the business. Hillenbrand will retain about 49%, allowing for future collaboration while positioning Milacron for enhanced growth. This partnership aims to leverage Bain Capital's experience in amplifying potential growth and operational efficiencies.
Transforming Hillenbrand’s Focus
According to Kim Ryan, President and CEO of Hillenbrand, this sale is a pivotal move towards the company's transformation into a pure-play industrial entity. Hillenbrand intends to concentrate on its core strengths, particularly in the development of process and automation equipment tailored for the food, pharmaceutical, and polymer sectors.
Strategic Portfolio Review
The decision to divest a majority stake in Milacron emerged from a comprehensive strategic portfolio review. Since acquiring Milacron Holdings Corp. in 2019, which included several brands such as Mold-Masters and DME, Hillenbrand has actively streamlined its operations. Following the successful sale of its Cimcool business in 2020, the focus has shifted towards nurturing its remaining strategic assets.
Future Prospects for Milacron
Matt Evans, a Bain Capital partner, emphasized the firm's excitement about guiding Milacron's seasoned management team as they enhance manufacturing capabilities and aftermarket solutions. This collaboration aims to harness emerging technologies and capitalize on favorable industry trends, ensuring Milacron's sustained growth trajectory.
Financial Implications of the Sale
After customary closing adjustments, Hillenbrand anticipates after-tax proceeds of roughly $250 million, earmarked for debt reduction. This financial strategy aligns with Hillenbrand's objective to enhance its balance sheet while investing in its primary operational focus areas.
A Glimpse into Hillenbrand
Hillenbrand is recognized as a global industrial powerhouse that delivers mission-critical processing equipment and solutions across various sectors. The company's commitment to excellence and innovation reflects its guiding purpose: Shape What Matters For Tomorrow™. With a diverse portfolio encompassing durable plastics, food processing, and recycling equipment, Hillenbrand continues to serve key industries globally.
Looking Ahead
The completion of this significant transaction marks a new chapter for both Hillenbrand and Milacron. By partnering with Bain Capital, Hillenbrand is pivoting towards its future with a keen focus on maintaining operational excellence and shareholder value. Together, they envision a roadmap that harnesses the strength of Milacron's legacy while embracing innovation in manufacturing.
Frequently Asked Questions
What prompted Hillenbrand's sale of Milacron to Bain Capital?
The sale was part of Hillenbrand's broader strategy to refocus on its core industrial operations and enhance its portfolio mix.
How will this transaction benefit Milacron?
Bain Capital's expertise and resources will support Milacron's growth, helping to enhance its manufacturing capabilities and market position.
What financial impact does Hillenbrand expect from the sale?
Hillenbrand anticipates around $250 million in after-tax proceeds, which will be allocated to debt reduction.
What is Hillenbrand's core business focus after this sale?
Following this transaction, Hillenbrand will concentrate on providing process and automation equipment for food, pharmaceutical, and polymer markets.
What remaining brands does Hillenbrand retain?
Hillenbrand retains ownership of Mold-Masters and DME, which are key components of its industrial portfolio post-sale.
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