US Silica to be taken private by Apollo for $1.85 billion

US Silica, based in Katy, is to be taken private by Apollo. The deal values the company at $1.85 billion. The price being offered is $15.50, which represents an 18.7% premium to US Silica’s closing share price of $13.06 on April 25.



The company primarily produces silica which is used as a proppant in fracking. It also produces diatomaceous earth which is used as a filtration product in various industries. The company has revenues of $1.5 billion.

Long storied history

The company traces its roots to two companies over 120 years old. The first is Pennsylvania Glass Sand Company, founded in 1894 to mine sand from the Oriskany formation in West Virginia. It was acquired by ITT in 1968 and then by RTZ Corporation (now Rio Tinto) in 1987. The second is Ottawa Silica Company, founded in 1900 in Illinois. RTZ acquired the company in 1986 and merged it with Pennsylvania Glass Sand the following year to form US Silica.

4 PE owners in 16 months!

RTZ sold US Silica in 1995 for $120 million, which began a series of PE owners for the company. First up was D George Harris and Associates, who bought the business from RTZ. The eponymous founder died in 2007 and, shortly after, US Silica was sold to Harvest Partners for $200 million. Less than one month later, Harvest flipped it to Harbinger Capital Partners for $300 million. In turn, Harbinger sold the business 15 months later for $337 million to Golden Gate Capital.

Golden Gate took the business public in 2012 in an IPO that valued the business at $900 million.

The business moved its corporate headquarters from Maryland to Katy, TX in 2018.

The agreement with Apollo includes a 45-day “go-shop” period that will expire at 12:01 AM ET on June 10, 2024, which permits U.S. Silica and its financial advisor to actively initiate, solicit and consider alternative acquisition proposals from third parties.

Long- serving CFO Don Merril was terminated in October 2023. Kevin Hough, Corporate Controller, has been interim CFO.

https://www.prnewswire.com/news-releases/us-silica-holdings-inc-to-explore-strategic-alternatives-for-industrial–specialty-products-isp-segment-301394507.html

 

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