US government shutdown delays Momentive takeover

Waterford, New York - The US government shutdown, which came to an end 26 Jan – has delayed Momentive Performance Materials Inc.’s takeover.

In a filing with the US Securities and Exchange Commission, Momentive said that it has agreed to extend the deadline to 13 June in order to obtain merger clearance from the US authorities.

A consortium of three South Korean firms — KCC Corp., Wonik QnC Corp. and SJL Partners LLC — are buying MPM Holdings Inc., the parent company of global silicones supplier Momentive.

If the Committee on Foreign Investment in the US – part of the US Treasury – does not approve the deal by then, either side could walk away.

When Momentive announced the plan in September 2018, it expected the deal to close in the first half of 2019.

The South Korean companies had agreed to acquire Momentive for about $3.1 billion (€2.65 billion), including assuming all of Momentive's net debt, pension and OPEB liabilities.

Momentive reported total liabilities of $2.18 billion through six months of 2018.

Under terms of the agreement, the investor group will assume Momentive's net debt obligations subject to minimum closing cash requirements of $250 million.

KCC is a Korean chemical engineering, paint and building materials company.

Wonik QnC makes and sells quartz and ceramics for silicon wafers.

SJL Partners is a private equity investment manager.