Celanese to acquire Omni Plastics
On December 18, 2017, Celanese (CE) announced that it has entered a definitive agreement to acquire Omni Plastics including its subsidiaries and its distributor Resinal de Mexico. Celanese did not disclose the financial aspects of this deal. CE expects the acquisition to be completed in the first quarter of 2018, subject to regulatory approvals. This acquisition could strengthen CE’s presence in several business areas.
About Omni Plastics
Omni Plastics is headquartered in Evansville, Indiana, and has a strong presence in Mexico. The company specializes in the custom compounding of various engineered thermoplastic materials. Omni Plastics brands include OmniLon, OmniPro, OmniCarb, and OmniTech. Omni Plastics’ automotive clients include Toyota (TM), General Motors (GM), and Ford Motor (F).
Scott Sutton, the chief operating officer of Celanese, said, “This acquisition further strengthens our global asset base by adding compounding capacity in the Americas to enable Celanese to continue to support a growing and diverse customer base.”
Celanese stock update
Celanese stock remained flat for the second week and closed at $106.54. However, the stock went up on December 18, when the takeover was announced. CE traded 3.2% above the 100-day moving average price of $106.13, indicating an upward trend in the stock. Analysts still see further upside in the stock and have recommended a target price of $112.0, implying a return potential of 5.2% over the closing price as of December 22, 2017. On a year-to-date basis, the stock has risen 35.3%. CE’s 14-day RSI of 50 indicates that the stock is neither overbought nor oversold.
Investors can indirectly hold Celanese by investing in the First Trust Materials AlphaDEX Fund (FXZ), which has invested 1.9% of its portfolio in Celanese.