RE:RE:FYI
HAWK37 wrote: Ocean112, Regarding Olin buying Canexus Chlor-Alkali (CA) Business: yet another stupid comment (you management at Canexus?). 1. Olin just bought a CA business from DOW for $5 billion (announced today). Me thinks they will be busy for a while, 2. Olin paid 5 times EBITDA. You keep saying Canexus CA business is worth 10 times. The market speaks., 3. CA facilities have a tendency to explode. You should do a tiny bit of research before you post. please. RH
HAWK37: The EBITDA multiple that Olin paid for the Dow Chlorine Products is a bit hard to quantify. It was a complicated transaction.
I can’t say that I understand it but they have basically said that it cost Olin $5b and due to some tax benefits benefited DOW $8b.
There is a presentation available on the Olin website re the transaction that can be found here.
https://www.olin.com/Profiles/Investor/Investor.asp?BzID=1548&from=du&ID=66273&myID=6806&L=I&Validate=3&I=
On page 11 of the presentation it is stated that the 2014 Dow Chlorine Products pro forma EBITDA is $0.64b.
Based on this info we could say;
Olin paid 7.8 x EBITDA ($5b)
DOW received due to the tax benefit 12.5 x EBITDA ($8b)
Based on this complicated transaction we could conclude that a fair price for the North Vancouver facility would be somewhere between 7.8 – 12.5 x EBITDA
As Always; Due Your Own Due Diligence; It’s Your Money !!