Apergy Merges With Ecolab's Nalco Champion to Form ChampionX

Updated 1 year 3 months ago

Apergy announced on December 19th that it had entered into a definitive agreement to acquire Ecolab's Upstream Energy business of Nalco Champion. The boards of directors of both companies have approved the agreement. The Upstream Energy business is being renamed ChampionX. The combined business will have estimated 2019 revenue of $3.5 billion and adjusted EBITDA of $615 million excluding synergies. The company expect cost savings of $75 million within 24 months of closing. Ecolab's President of Upstream Energy will serve as COO taking responsibility for ChampionX and the integration project. The company will be headquartered at Apergy's current offices in The Woodlands, Texas.

The transaction is a "Reverse Morris Trust" in which ChampionX is simultaneously spun-off to Ecolab's shareholders while becoming a subsidiary of Apergy. Apergy will issues approximately 127 million shares to existing Ecolab shareholders and assume a net debt of USD 492 million. Existing Ecolab shareholders will own around 62% of the combined company. Bank of America will provide a term load of $537 million to fund a cash payment of $492 million to Ecolab. Centerview Partners and Lazard served as advisors to Apergy while Bank of America Securities served as an advisor to Ecolab.

Apergy shareholders approved the deal in May 2020, and the deal is expected to close in the second quarter of 2020. The new company will be named ChampionX Corp. with the ticker symbol CHX. The transaction closed in early June 2020.

President & CEO of ChampionX

We will immediately implement our plans to capture the $75 million in expected cost synergies, plus additional revenue growth opportunities made possible by the complementary product, geography, and customer profiles of the combined organization.