MERSEN (EPA:MRN) - Acquisition of specialty graphite production capacity

Transparency directive : regulatory news

08/07/2019 17:40

PRESS RELEASE

STRATEGIC ACQUISITION OF ADDITIONAL AND MODULAR SPECIALTY GRAPHITE PRODUCTION
                                  CAPACITY

- MODULAR INVESTMENT DEPENDING ON FUTURE MARKET NEEDS
- REPATRIATION OF THE PRODUCTION OF GRAPHITE GRADES
- EUR5 MILLION TO EUR10 MILLION MINIMUM IMPROVEMENT IN GROUP EBITDA BY 2023

PARIS, JULY 8, 2019 - Mersen (Euronext FR0000039620 - MRN), a global expert in
electrical power and advanced materials, has announced the acquisition of
assets in the graphite business of the former Graftech site in Columbia
(Tennessee).

Luc Themelin, Mersen's Chief Executive Officer, said: "Given today's
particularly buoyant market, our goal at Mersen was to find a solution that
would give us the additional graphite production capacity we need to satisfy
market demand from 2020 and beyond. This acquisition is an excellent
opportunity to fulfil several objectives: limited initial investment despite
the quality of the assets, a gradual ramp-up in line with market dynamics, and
additional capacity to give us a new competitive advantage on certain materials
that the Group currently purchases from outside suppliers."

The operation concerns the acquisition of land, buildings and equipment for a
total of USD 7 million and coupled with additional, modular investment, will
enable the Group to meet several strategic goals over time:

  - Access to complementary isostatic graphite production capacity for a much
    lower cost than building a new factory.

  - Repatriation within the Group of the production of specialty extruded
    graphite which is currently purchased from outside suppliers and is used
    for heat exchangers and certain applications in the process industries and
    oil and gas, thereby securing supply and benefiting from the associated
    margins.

The Group could invest between EUR25 million and EUR35 million over the next
three to five years to ensure the optimal commissioning of the facilities that
will give it an additional production capacity of between 2,000 and 4,000 tons
per year for each isostatic and extruded graphite specialties segments. These
investments will start in 2019, for an estimated amount of EUR5 million.

The operation is expected to have a positive impact of at least EUR5 million to
EUR10 million on Group EBITDA by 2023.

Graftech is a key player in synthetic graphite that disposed of its various
specialty carbon product operations in 2016/2017, selling its Columbia site to
GT Columbia LLC and GT Acquisition Holdings LLC in 2017. Mersen is buying the
assets to these 2 companies.

ABOUT MERSEN

A global expert in electrical power and advanced materials, Mersen designs
innovative solutions to address its clients' specific needs to enable them to
optimize their manufacturing performance in sectors such as energy,
electronics, transportation, chemicals & pharmaceuticals and process
industries.

Mersen, with its 6,900 employees working across 35 countries, recorded sales of
EUR878 million in 2018.

MERSEN IS LISTED ON EURONEXT PARIS - COMPARTMENT B

INVESTOR AND ANALYST RELATIONS        MEDIA RELATIONS
Véronique Boca                        Emily Oliver/Lea Truchetto
Mersen                                FTI Consulting Strategic Communications
Tel.: +33 (0)1 46 91 54 40            Tel.: +33 (0)1 47 03 68 10
Email: dri@mersen.com                 Email: emily.oliver@fticonsulting.com /
                                      lea.truchetto@fticonsulting.com

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