Solstice Advanced Materials to acquire Element Solutions in $14.5B deal

The acquisition is expected to create the following strategic and financial outcomes:

• Builds a scaled advanced materials platform, advancing Solstice's existing strategy

The combination advances Solstice's strategy to establish a scaled advanced materials platform with greater exposure to electronics, AI infrastructure, thermal management, data center cooling applications, and other specialty markets.

• Strengthens Solstice's electronics platform with complementary capabilities

Element Solutions brings formulation expertise, R&D capabilities, technical service, and deep customer relationships that complement Solstice's strengths in chemistry, application development, refrigerant application solutions, and high-performance materials. According to Solstice, the combined entity expects to serve customers across semiconductor fabrication, advanced packaging, and assembly, from early-stage development through qualification and high-volume production. The combination is expected to create a broader platform for customer-led innovation, as electronics customers increasingly need materials technology to address the inherent challenges associated with advanced electronics. The combined company's enhanced scale is also expected to accelerate Element's high-growth technologies, such as Kuprion ActiveCopper.

• Broadens Solstice's role across AI infrastructure and other specialty markets

   

The transaction is expected to strengthen Solstice's exposure to AI infrastructure by connecting its electronics, packaging, and thermal management capabilities with data center cooling and refrigerant application solutions. This broader platform will position the combined company to support customers across key parts of the advanced computing ecosystem, from higher-performance chips and packaging architectures to cooling solutions that improve efficiency and reliability. The combined company is also expected to retain specialty positions, including serving as the sole U.S. supplier of uranium conversion services that support the nuclear fuel cycle.

• Strengthens long-term growth, margin, and cash flow profile

Solstice projects mid-to-high single-digit CAGR revenue growth, high single-digit to low double-digit CAGR Adjusted EBITDA growth, and approximately 75% cash conversion over the medium term for the combined company. Solstice expects to realize more than $180 million in net synergies by the third year following close, driven by procurement efficiencies, manufacturing optimization, supply chain optimization, operational efficiencies, and SG&A savings. Additional revenue synergy opportunities are expected over time.

• Accretive in year one, with rapid de-leveraging

   

The transaction is expected to be accretive to Adjusted EPS in year one after close. The combined company is expected to carry net leverage of approximately 3.5x at close, with de-leveraging to below 3x Adjusted EBITDA anticipated within 18 months. The combined company will target a net leverage ratio of 2.0–3.0x Adjusted EBITDA and remains committed to a strong sub-investment grade credit rating. The combined company expects to continue its policy of maintaining and growing its quarterly dividend over time.

Under the terms of the agreement, Element Solutions shareholders will receive, for each share of Element common stock, $10.00 in cash and 0.500 shares of Solstice common stock, representing implied consideration of approximately $50.10 per Element share — a premium of approximately 15% over Element's closing share price on July 2, 2026. Upon closing, Element shareholders are expected to own approximately 44% of the combined company.

The transaction has been unanimously approved by the respective Boards of Directors of both companies and is expected to close in the first half of 2027, subject to customary closing conditions, including receipt of required regulatory approvals and approval by Solstice and Element shareholders, as applicable.

Upon closing, the combined company will operate under the Solstice name. David Sewell will serve as President and Chief Executive Officer. Solstice expects to maintain a strong operating presence across both companies' existing major sites and build a leadership team with strong representation from both organizations. Solstice's Board of Directors will be comprised of 11 directors upon closing, including Element Solutions CEO Ben Gliklich and two additional designees from the Element board, subject to standard governance procedures.

Financing

Solstice has secured fully committed financing in the form of an initial $4.7 billion bridge commitment from Goldman Sachs, which it plans to replace with permanent debt financing. Combined with cash from its balance sheet, this financing will fund the cash consideration payable at closing. Solstice states its continued focus on maintaining a disciplined capital structure.

David Sewell, president and CEO of Solstice, stated, "Overall, we believe the combined company will be very well-positioned to benefit from generational tailwinds in high-growth end markets. Element brings highly complementary capabilities, deep customer relationships and a technical service-led model that expands how we support customers from early-stage development through high-volume manufacturing. This high-performing team brings with it inimitable domain expertise and customer process know-how in addition to a compelling track-record of value creation for shareholders. Together, we expect Element and Solstice to be extremely well positioned to deliver on our customers' growing requirements for signal integrity, thermal management, reliability and performance."

Sewell added, "Both companies have strong cultures grounded in integrity, innovation, teamwork and customer focus, with comprehensive patent portfolios and highly talented employees who are at the top of their profession. We intend to blend the best of our talents and cultures to build an organization with a broader technology platform and a stronger ability to co-innovate with customers to develop unique solutions addressing emerging, complex requirements from our combined customer base."

Ben Gliklich, CEO of Element Solutions, stated, "Since Element's founding in 2019, we have delivered a strategy balancing operational excellence and prudent capital allocation to cement our position in the fastest growing, highest value niches of our markets. This transaction recognizes that achievement and brings together two great companies with shared attributes, strong market positions, attractive margins, deep technical know-how and excellent people to accelerate their combined growth. We are creating a scaled advanced materials platform with complementary capabilities to broaden our offerings in our core electronics markets and deliver differentiated solutions to customers. We believe that the breadth of the combined portfolio along with enhanced innovation and manufacturing capabilities will allow us to better solve the pain points emerging in the leading edge of the electronics industry. This is an exciting opportunity for our people and shareholders, both of whom are expected to participate in the anticipated long-term upside of the combined company."

Sewell further stated, "This transaction allows us to amplify our transformational growth in electronics while building on the strength of Solstice's existing businesses. Our refrigerant application solutions platform, including data center cooling, and our specialty exposures such as nuclear fuel remain core to the combined company's value proposition and central to helping customers improve efficiency, resilience and performance. Together, we aim to create a higher growth, higher margin advanced materials leader with greater global reach. I am confident we will successfully integrate our teams by taking a best-of-both approach, building on our respective strengths, and creating an even stronger organization."