LONDON –  Isola Group is set to buy Polyclad Laminates from Cookson Group (the parent company of Cookson Electronics) for $91 million. The deal is expected to close in February. 

Combined, the companies would be neck-and-neck with Nanya as the second largest supplier of laminate materials, behind Matsushita. Polyclad had sales of $171 million through the third quarter of 2005, while Isola said its revenues will top $400 million this year.

In a statement Isola CEO Ray Sharpe said, “This acquisition strengthens our technology base, our product portfolio and provides an enlarged footprint in Asia Pacific, especially Southern China.  It bolsters Isola’s focus on bringing new products to market for our customers, and allows us to better leverage all of the manufacturing facilities and offer our customers economies of scale that individually we could not.” 

The move has long been anticipated by many industry watchers. Before coming to Isola, in June 2004, Sharpe had held the CEO spot at Cookson Electronics for more than 10 years.

It is not yet clear what impact the deal will have on the companies' existing footprints and licensing deals. Polyclad has licensing deals with LG Chem, Sanmina-SCI and GE, among others.

Nick Salmon, chief executive of Cookson Group, said the sale was part of a strategic “progressive debt reduction” to meet profitability targets.
 
“While we have recently been successful in returning the Laminates business to break even, it has for too long had a detrimental impact on the earnings profile of our Electronics division,” Salmon added. “[The sale] is the right thing for that division and for the Group as a whole.”

Through the third quarter, Cookson had reported flat sales of 98 million pounds ($171 million at today’s exchange rates) for Polyclad, and a loss of 1.2 million pounds ($2.1 million). In 2004, Polyclad had sales of 132 million pounds ($230 million).

Ed. note (Dec. 21): The original filing of this story contained incorrect currency conversions for Polyclad. Polyclad's parent company, Cookson, reports in pounds sterling, not euros.

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