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Unifrax buys company for $1.3B; workers ratify deal to end strike

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Unifrax deal

Striking workers have ratified a new deal at Unifrax's Tonawanda plant and are back to work.

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Unifrax Corp. has agreed to buy a Connecticut-based manufacturer in a blockbuster deal valued at $1.3 billion.

Separately, hourly workers at a Unifrax manufacturing plant in Tonawanda have ratified a contract, ending a strike that began May 17.

Tonawanda-based Unifrax plans to acquire Lydall Inc., a maker of specialty filtration materials with 23 manufacturing facilities worldwide.

“The combination of Unifrax and Lydall creates a global specialty materials platform with new cutting-edge technologies in advanced filtration, electric vehicle battery systems, and energy-saving applications,” said John Dandolph, Unifrax's president and CEO.

The deal is a big leap for Unifrax, which has 37 facilities around the globe. Unifrax has the backing of Clearlake Capital Group, a California-based investment group that has owned the company since 2018.

“We have supported Unifrax’s development of new technologies over the last few years that have the potential to change how we think about the industries in which both Unifrax and Lydall operate and inform their futures,” said José E. Feliciano, co-founder and managing partner at Clearlake, and Colin Leonard, partner at Clearlake, in a joint statement.

Unifrax, which makes high-temperature insulation products, said Lydall is well positioned to capitalize on growth in clean air filtration and electric vehicle adoption, "among many other attractive markets.”

The price of Lydall’s shares skyrocketed on the New York Stock Exchange on Monday on news of the Unifrax deal. Shares were trading at over $60 per share on Monday afternoon, after closing at $33.29 on Friday.

Lydall traces its roots in Connecticut to 1869, and has  played a role in supporting frontline workers during the pandemic. During 2020, the company said it supplied enough fine fiber meltblown filtration media for nearly 1 billion face masks.

“We are excited about the combination of Lydall and Unifrax,” said Sara Greenstein, Lydall’s president and CEO. “With this transaction, we are creating a leader in specialty filtration and advanced materials with over 250 years of combined expertise and experience delivering innovative and compelling solutions to customers worldwide.”

Unifrax’s deal for Lydall is set to close in the second half of the year, pending approval by regulators and Lydall shareholders. Lydall shareholders are set to receive $62.10 per share as part of the acquisition.

Meanwhile, hourly workers at Unifrax’s plant on Fire Tower Drive started returning to their shifts on Sunday, after ratifying a three-year deal on Friday.

The agreement covers about 190 members of Steelworkers Local 4-2058. The company did not disclose terms of the deal, and the local’s president, Donald Rice, could not be reached to comment Monday.

“We are pleased to reach an agreement and new contract with the USW Local 4-2058, and have our employees resume work,” said Brian Walker, Unifrax's chief human resources officer.

Matt Glynn

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