October 28, 2021
ECOLAB ACQUISITION OF PUROLITEAccelerating growth in life sciences and strengthening positions in high value industrial markets
CAUTIONARY STATEMENT
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Forward-Looking Information This communication contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995.
These forward-looking statements include, but are not limited to, statements regarding benefits of the Purolite acquisition, the expected timing of completion of the
acquisition, tax benefits, amortization expense, revenues, adjusted earnings per share and margins, synergies, market trends, financing, credit ratings, debt repayment and
cash priorities. These statements are based on the current expectations of management. There are a number of risks and uncertainties that could cause actual results to
differ materially from the forward-looking statements included in this communication. These risks and uncertainties include (i) the risk that the regulatory approvals or
clearances required for the acquisition may not be obtained, or that required regulatory approvals may delay the acquisition or result in the imposition of conditions that
could have a material adverse effect on the company or cause the company to abandon the acquisition, (ii) the risk that the conditions to the closing of the acquisition may
not be satisfied, (iii) the risk that a material adverse change, event or occurrence may affect the company or Purolite prior to the closing of the acquisition and may delay the
acquisition or cause the company to abandon the acquisition, (iv) problems that may arise in successfully integrating the businesses of the company and Purolite, which
may result in the combined business not operating as effectively and efficiently as expected, (v) the possibility that the acquisition may involve unexpected costs,
unexpected liabilities or unexpected delays, (vi) the risk that the credit ratings of the company may be different from what the company currently expects, (vii) the risk that
the businesses of the company or Purolite may suffer as a result of uncertainty surrounding the acquisition, (viii) unexpected operating risks at Purolite and (ix) the risk that
disruptions from the transaction will harm relationships with customers, employees and suppliers. Other unknown or unpredictable factors could also have material adverse
effects on future results, performance or achievements of the company, Purolite and the combined business. For a further discussion of these and other risks and
uncertainties applicable to the company, see Item 1A of our most recent Form 10-K, and our other public filings with the SEC. In light of these risks, uncertainties,
assumptions and factors, the forward-looking events discussed in this communication may not occur. We caution that undue reliance should not be placed on forward-
looking statements, which speak only as of the date made. We do not undertake, and expressly disclaim, any duty to update any forward-looking statement, except as
required by law.
Non-GAAP Financial Information This communication includes Company information that does not conform to generally accepted accounting principles (GAAP).
Management believes that a presentation of this information is meaningful to investors because it provides insight with respect to ongoing operating results of the Company
and allows investors to better evaluate the financial results of the Company. These measures should not be viewed as an alternative to GAAP measures of performance.
Furthermore, these measures may not be consistent with similar measures provided by other companies. Non-GAAP measures included within this presentation are defined
in the “Non-GAAP Financial Measures” section of this presentation.
Industry and Market Information: Industry and market information, including market data, contained in this communication are based on management’s current estimates
of potential opportunities of Ecolab. These estimates have been made in good faith based on management’s knowledge and, in some cases, upon industry surveys and
other publicly available information. You are cautioned not to give undue weight to such estimates, and we have not verified the accuracy or completeness of these
estimates and information through independent sources.
ACQUISITION HIGHLIGHTS
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Attractive financial profile with double digit growth and highly attractive adjusted EBITDA margins
Highly attractive platform that will also further accelerate growth in critical industrial markets like
food & beverage, microelectronics, power and precious metals
Deepens Ecolab’s core customer relationships in life sciences by adding product safety expertise
to our environmental safety programs, leveraging corporate accounts, field service, R&D and
geographic footprint
New major global growth platform adding very high margin products and services that have a
strong fit with Ecolab’s customer value proposition, business model and sustainability goals
New high growth, high margin enterprise platform that will enable new, comprehensive offerings
to help customers produce better products, reduce their environmental footprint and total cost
Leading, global provider of high-end recurring purification and separation solutions to improve
end-product quality and environmental footprint in fast-growing, highly attractive markets
TRANSACTION OVERVIEW
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Purolite – leading provider of fast growing, high value separation and purification solutions to the life sciences and industrial markets
2021E sales of ~$390M, adj. EBITDA margin of ~41% and adj. operating income margin of ~37%
Growth acquisition that accelerates growth in life sciences and enhances exposure to high value industrial applications
Opportunity to acquire world-class talent, critical technologies and valuable IP
$3.7B purchase price
~23x 2021E adj. EBITDA
~19x 2022E adj. EBITDA
Neutral to 2022E adj. EPS and nearly $0.10 accretive to 2023E adj. EPS with growing contribution thereafter (including Purolite
transaction amortization)
Deal-related amortization impact: ~$0.26 in 2022E
Expect to realize tax benefits from the transaction structure with an estimated net present value of ~$300M
Accretive to sales growth and adj. EBITDA margin
Significant opportunity to deliver commercial synergies
Expect to generate returns significantly above our weighted average cost of capital
~$800M of excess cash on balance sheet and low-cost debt for the balance
Expect to preserve strong investment grade rating
Closing expected in Q4 2021 (subject to regulatory approval and other customary closing conditions)
PUROLITE OVERVIEW
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Leader in premium fluid treatment solutions focused on
high-end applications
Global provider of separation and purification technology with
~40 years of experience
Broad range of unique products with a focus on biopharma and high value
industrial uses
5,000 customers across life sciences, water, chemicals, electronics and
food & beverage end markets
Operates in more than 30 countries and employs ~1,000 people worldwide
Well-positioned to capitalize on attractive growth trends
Industrial
~60%
Life Sciences
~40%
Attractive financial profile
~$390M2021E Revenue
~$160M2021E Adj. EBITDA
Balanced end market exposure
Revenue by end market1
1 Based on 2021E Revenue2 India, Middle East and Africa
~14%Historical growth rate
2017-2021E
~41%Adj. EBITDA margins
Significant global reach
Revenue by geography1
~35% North
America
~35% Europe
~20% Asia
Pacific
Philadelphia, PA. USA
Victoria.
Romania
Deqing. China
Llantrisant, Wales. UK
Moscow. Russia
R&D Center (5)
Manufacturing (4)
Headquarters
~$390M
~$145M2021E Adj. Operating income
~37%Adj. Operating margins
~5% Latin
America
~5% IMEA2
MISSION CRITICAL, CONSUMABLE SOLUTIONS TARGETING A
FAST-GROWING ~$5B MARKET
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Life Sciences Industrial
Water treatment and process fluid separation & purification~40%1 ~60%1
Addressable
market2 ~$2.2B ~$2B ~$0.8B
4-5%Market
growth >10% 6-8%
BiopharmaDrug
formulationSpecialty processesPower & chemicalsFood & beverage
1 Based on 2021E sales2 Source: MarketsandMarketsTM 2020
Sweetener
solutions
Taste
enhancement
Ultrapure water for
nuclear power
PFAS / environmental
protection
Ultrapure water for
semiconductors
Drug ingredients (APIs) /
excipientsPurolite
applications
Pharma extraction /
purification
Monoclonal antibodies
chromatography
Cell and
gene therapy
Precious metal
recovery and purification
STRONG VALUE PROPOSITION AND BUSINESS MODEL FIT,
DEEPENING ECOLAB’S CORE CUSTOMER RELATIONSHIPS
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High end, high value consumable products
Critical to customer operations and market quality/
safety
~95% consumable revenue
Focused on customer partnerships and direct selling
Corporate accounts approach
Global direct sales team with highly technical skills
Technology driven sales and solution culture
Advanced technology with strong R&D capabilities
Proprietary manufacturing capabilities
Global presence with strategically located facilities
+2,000unique products
~5,000customers globally
5R&D centers
Expands Ecolab’s addressable markets across life sciences and industrial markets
COMBINED
Life Sciences
Industrial
~$7B ~$3B ~$10B
~$60B ~$2B ~$62B
Total ~$67B ~$5B ~$72B
1 Market data reflects current estimates of potential opportunities. 2 Source: MarketsandMarketsTM 2020
1 2
FURTHER ENHANCING ECOLAB’S ENVIRONMENTAL CONTRIBUTION
Addressing key environmental issues
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PFAS Remediation Waste Water Treatment
New technology reduces the cost of PFAS
removal in groundwater
Innovative solutions for the removal
of toxic compounds
WaterClimate
Desalination Purification
Reduces mineral content in water
Airstream Purification
Controls VOC emissions
Radionuclide Removal
Minimizes process waste generated in
decontamination proceduresNatural catalysts supporting
eco-sustainable processes
Greener Industrial Manufacturing
Air Waste
BIOLOGICS DEVELOPMENT FUELING GROWTH IN PHARMACEUTICALS
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Source: EvaluatePharma; Grand View research
Global pharmaceutical manufacturing market ($B)
2019-2027 CAGR
14% Total
13%
Conventional
15%
Biopharma
Key Biopharma trends
Novel technologies, such as gene and cell therapy for vaccines and personalized medicines
Biopharma therapies growing double digits to represent ~40% of all drug therapies by 2023
55% of the top 100 drugs by 2026
$324
$406
$487
$560
$635
$709
$782
$849
1 2 3 4 5 6 7 8 9
$909
2020 2021 2022 2023 2024 2025 2026
◼ Biopharma
◼ Conventional
20272019
COMBINATION CREATES ENHANCED VALUE PROPOSITION FOR OUR
LIFE SCIENCES CUSTOMERS
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Strategic fit
Stronger outcomes for customers
Common customer base
FAST GROWTH BIOPHARMABIG PHARMA
Environmental safety Product safety
ATTRACTIVE PLATFORM TO FURTHER EXPAND ECOLAB’S FAST-
GROWING LIFE SCIENCES BUSINESS
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Business
Continuity
Risk
Mitigation
Environmental +
Health Protection
Operational
Efficiency
~$40
~$160
2017 2021E
FDA
Regulated
Recurring
Revenue
Consumables
Technical
Value Sale
~$130
~$270
2017 2021E
Life Sciences sales ($M)
Clean room
environments
Tool
sterilization
Drug
purification
CAGR:
~40%
CAGR:
~20%
Water
Drug
formulation
Environmental
protection
Life Sciences sales ($M)
Shared value propositions Attractive, complementary
markets with significant growth
Key product
offerings
$1
Customers
OUT-SIZED OPPORTUNITY FROM BIOPHARMA GROWTH
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Positioned to take market share in fast growing
Biopharma market
Purification
technology
Biopharma Purification
market structure
Attractive market dynamics
Fastest growing area in the pharma market
Quality of product
Technology included in 80 upcoming clinical trials and
drug submittals through the FDA
Incremental manufacturing capacity
With dual source of supply in Europe and the U.S. in a
high demand global market
Life sciences brand equity
Key partnerships with leading pharma companies
NEW PLATFORM PROVIDING COMPLEMENTARY HIGH TECH SOLUTIONS
IN CRITICAL INDUSTRIAL MARKETS
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Microelectronics
Ultrapure water
Power Generation
Ultrapure water
Precious Metals
Recovery & purification
Food & Beverage
Taste & product quality enhancement
Lithium Purification
Emerging opportunity
LEVERAGING ECOLAB’S CORPORATE ACCOUNTS, FIELD MODEL AND
R&D TO ACCELERATE PUROLITE’S GROWTH
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Field Model R&DCorporate Accounts
BEST RESULTS AT LOWEST TOTAL COST
(Reduced water, energy, waste impact)
BREAKTHROUGH
TECHNOLOGY
ON-SITE
EXPERTISE
GLOBAL
KNOW-HOW
PREDICTIVE
INSIGHTS
ACCESS TO A LARGE, GLOBAL
CUSTOMER BASE
COMPLEMENTARY OFFERINGS
PROVIDING COMPREHENSIVE
CUSTOMER SOLUTIONS
OPTIMIZING CUSTOMER
EXPERIENCE THROUGH DATA
ANALYTICS AND TAILORED
SERVICES
LEVERAGING EXPERTISE AND
INNOVATION RESOURCES TO
ACCELERATE TECHNOLOGY
DEVELOPMENTS
Accretive to long-term performance
Strong incremental growth
Strong margins
Expect to generate returns significantly above our weighted average cost of capital
Ecolab has significant financial flexibility to acquire Purolite
Expect to finance transaction price with ~$800M of cash and low-cost debt
Committed to targeting A-range credit metrics and ~2x net debt / adjusted EBITDA
Prioritize deleveraging post transaction by utilizing cash flow to repay short-term maturities
Unchanged cash priorities
Invest in the business, grow dividend, fund acquisitions and share repurchase
FINANCIALLY ATTRACTIVE TRANSACTION
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SUMMARY – PUROLITE ADDS HIGH GROWTH AND INNOVATION
EXPERTISE
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Strong fit with Ecolab’s value proposition, business model and environmental commitments
Creates a new growth platform and adds fast growing $5 billion incremental opportunity in life sciences and industrial
Leading provider of mission critical solutions with ~95% consumable revenue
Opportunity to capitalize on the rapid growth in life sciences while leveraging opportunities in industrial
Talent driven, world class technological expertise driving strong customer relationships
Strong growth history and expected long-term outlook, accretive to growth and margins
ULTRAPURE
WATERMICROELECTRONICS
ENVIRONMENTAL
PROTECTIONBIOPHARMA
NON-GAAP FINANCIAL MEASURES
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Definitions
▪ EBITDA: the sum of earnings before interest, taxes, depreciation and amortization.
▪ Adjusted EBITDA: EBITDA excluding the impact of special (gains) and charges, including certain non-recurring costs
▪ Adjusted EBITDA Margin: calculated by dividing Adjusted EBITDA by sales
▪ Adjusted Operating Income: operating income excluding the impact of special (gains) and charges, including certain non-recurring costs
▪ Adjusted Operating Income Margin: calculated by dividing Adjusted Operating Income by sales
▪ Adjusted EPS: diluted earnings per share excluding impact of special (gains) and charges and discrete tax items
We do not provide reconciliations for non-GAAP estimates on a forward-looking basis (including those contained in this report) when we are unable to provide a meaningful or accurate calculation or estimation of reconciling items and the information is not available without unreasonable effort. This is due to the inherent difficulty of forecasting the timing and amount of various items that have not yet occurred, are out of our control and/or cannot be reasonably predicted, and that would impact the most directly comparable forward-looking GAAP financial measures. For the same reasons, we are unable to address the probable significance of the unavailable information.
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