Matthews International Corp Enters Contribution Agreement to Sell SGK Brand Solutions

On January 7, 2025, Matthews International Corporation (NASDAQ: MATW) entered into a Contribution Agreement to sell its interest in SGK Brand Solutions. The agreement involves Matthews selling SGK to a new entity formed by SGS. Under the terms of the agreement, Matthews will receive $350 million upfront, consisting of $250 million in cash at closing, $50 million in preferred equity in the new entity, and retaining approximately $50 million in trade receivables. Matthews will also obtain a 40% interest in the common equity of the new entity, valued at around $900 million.

The newly combined entity is expected to realize over $50 million in annual cost synergies over a 30-month integration period. Gary R. Kohl, the current President of SGK, will lead the new entity as CEO, with Matthew T. Gresge, the current CEO of SGS, serving as Executive Chairman of the Board.

The transaction, subject to customary closing conditions and regulatory approvals, is anticipated to close in mid-2025. J.P. Morgan Securities LLC served as financial advisor, while K&L Gates and Covington & Burling LLP provided legal counsel to Matthews on the transaction.

Joseph Bartolacci, CEO of Matthews, highlighted the strategic process undertaken to enhance the value of diversified business units, including SGK. The sale is part of a move towards a more streamlined business model allowing for better valuation by public equity markets. The immediate cash proceeds will be utilized primarily for debt repayment.

Following the transaction, Matthews will record its investment and income from the new entity under the equity basis of accounting, no longer consolidating the SGK business in its financial statements.

The Company also issued a press release on January 8, 2025, confirming the execution of the Contribution Agreement. More details about the transaction can be found in the SEC filing and press release issued by the Company.

Participants involved in the solicitation of proxies for Matthews’ 2025 Annual Meeting include named executives and directors, details of which are provided in the public filings. Any forward-looking statements in the filing are covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, acknowledging potential risks and uncertainties affecting future results.

For additional information, interested parties are encouraged to refer to Matthews’ SEC filings or visit the company’s investor relations webpage.

This article was generated by an automated content engine and was reviewed by a human editor prior to publication. For additional information, read Matthews International’s 8K filing here.

About Matthews International

Matthews International Corporation provides brand solutions, memorialization products, and industrial technologies worldwide. It operates through three segments: Memorialization, Industrial Technologies, and SGK Brand Solutions. The Memorialization segment provides bronze and granite memorials, upright granite memorials and monuments, concrete burial vaults, cremation memorialization products, granite benches, flower vases, crypt plates and letters, cremation urns, niche units, cemetery features, and statues, as well as bronze plaques, letters, emblems, vases, lights and photo ceramics, granite monuments, mausoleums, crypts, and flush memorials.