Ecovyst Streamlines Focus As Technip Energies Snaps Up Catalysts Business

Core Insights - Ecovyst Inc. is selling its Advanced Materials & Catalysts division to Technip Energies for $556 million in cash, which will reshape both companies' strategic focus [1] - The sale values the business at approximately 10 times its 2024 adjusted EBITDA, with Ecovyst expecting net proceeds of about $530 million after taxes and expenses [1][2] Ecovyst Inc. Summary - The decision to divest was based on a strategic review indicating that the market undervalued the Advanced Materials & Catalysts unit [2] - Proceeds from the sale will be utilized to reduce debt and return capital to investors, with the divestiture expected to lower the company's net debt leverage ratio to below 1.5x [3] - Ecovyst plans to continue its $200 million share buyback program, reflecting confidence in its core sulfuric acid and regeneration businesses [3] Technip Energies Summary - The acquisition will accelerate Technip Energies' expansion into catalysts and advanced materials, which are essential for enhancing efficiency and sustainability across various industries [4] - The deal broadens Technip's offerings in polyethylene, hydrocracking, and emerging markets such as sustainable aviation fuel and carbon capture [4] - The Advanced Materials & Catalysts business generated $223 million in revenue last year with a 25% EBITDA margin, supported by three plants in the U.S. and Europe [5] Market Reaction - Following the announcement, Ecovyst shares increased by 6.96% to $9.830 in premarket trading [6]