EXHIBIT 99.1
Contacts:
For W. R. Grace & Co.: For Sealed Air Corporation:
Mary Lou Kromer Mary Coventry
W. R. Grace & Co. Sealed Air Corporation
561-362-2600 201-791-7600
Ruth Pachman Harry Savage
Kekst and Company Robert Marston & Associates
212-521-4800 212-371-2200
For Immediate Release
GRACE TO MERGE CRYOVAC (REGISTERED) BUSINESS WITH SEALED AIR IN
TAX-FREE TRANSACTION CREATING TWO NEW PUBLIC COMPANIES
NEW SEALED AIR, LED BY T.J. DERMOT DUNPHY, WILL BE WORLD'S
LEADING PROTECTIVE AND SPECIALTY PACKAGING COMPANY
GRACE SHAREHOLDERS TO OWN 63% OF NEW PACKAGING COMPANY AND
RETAIN 100% OWNERSHIP OF NEW GRACE SPECIALTY CHEMICALS COMPANY
TRANSACTION VALUE TO GRACE AND ITS SHAREHOLDERS IS
APPROXIMATELY $5 BILLION, INCLUDING $1.2 BILLION CASH
CONTRIBUTION TO THE NEW GRACE
BOCA RATON, FL AND SADDLE BROOK, NJ, August 14,1997 -- W.
R. Grace & Co. (NYSE: GRA) and Sealed Air Corporation (NYSE:
SEE) today announced they have entered into a definitive
agreement to combine Grace's packaging business with Sealed Air
to create a new publicly owned company, to be called Sealed
Air, that will be the world's leading protective and specialty
packaging company, with annual sales in excess of $2.5 billion.
The transaction, tax-free to both companies and their
shareholders, is
expected to be completed in early 1998. Prior to the merger,
Grace's specialty chemicals businesses will become a new
publicly traded company that will be spun off to Grace
shareholders. The new company will consist of Grace Davison,
Grace Construction Products and DAREX Container Products, have
annual sales of approximately $1.5 billion and retain the Grace
name. The transaction will be preceded by a $1.2 billion
capital contribution to the new Grace specialty chemicals
company, which will use the cash to pay down substantially all
of its debt.
Grace shareholders will receive approximately 40.9 million
common shares and 36 million new convertible preferred shares
in the new Sealed Air. The convertible preferred shares will
have a stated value of $1.8 billion, be convertible into
approximately 31.8 million common shares of the new Sealed Air
at a per share conversion price of $56.525 and will pay
dividends at a four percent annual rate. On a fully diluted
basis, Grace shareholders and current Sealed Air shareholders
will own 63 percent and 37 percent, respectively, of the new
Sealed Air.
Based on Sealed Air's stock price at the close on August
13, the merger has an estimated value to Grace and Grace
shareholders of approximately $5 billion, including $1.9
billion of Sealed Air common stock, $1.8 billion face amount of
the convertible preferred shares and the $1.2 billion cash
contribution to Grace at the time of the merger.
Excluding the effect of transaction and integration costs,
the transaction is expected to be accretive to Sealed Air's
earnings per share going forward.
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Albert J. Costello, chairman, president and chief
executive officer of Grace, will continue to be chairman,
president and chief executive officer of the new Grace
specialty chemicals company, and T.J. Dermot Dunphy, chairman
and chief executive officer of Sealed Air, will be chairman and
chief executive officer of the new Sealed Air.
Mr. Costello said, "This transaction provides Grace
shareholders with an immediate premium for Grace's packaging
business, the opportunity to continue to participate in the
future value of an even stronger packaging company with
excellent growth prospects, and an ongoing stake in what will
now be a highly focused and strong specialty chemicals company.
It represents another significant achievement in our ongoing
mission to deliver substantial value to Grace shareholders,
both from operational improvements and creative transactions."
THE NEW SEALED AIR
Mr. Dunphy said, "The combination of Sealed Air and Grace
Packaging will create an outstanding protective and specialty
packaging company that will serve the needs of a broad range of
customers throughout the world. The rationale behind the
merger of these two packaging businesses, both leaders in
technological innovation and marketing effectiveness, is
clearly evident."
Mr. Dunphy continued, "The combined packaging company will
have global reach and will be well positioned to grow at above-
average rates in the rapidly changing global marketplace, to
penetrate new geographic markets with its full range of
products, and to seek out additional strategic alliances that
will
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further strengthen its global position. We expect that the
combined company will benefit from a broad range of operating
synergies."
On a pro forma basis, the new Sealed Air would have sales
in excess of $2.5 billion and, based on Sealed Air's current
stock price, a total market capitalization, including debt and
preferred stock, of approximately $7 billion.
The new Sealed Air will be headquartered in Saddle Brook,
New Jersey. In addition to Mr. Dunphy, other key executives
will include William V. Hickey, president and chief operating
officer of Sealed Air, and J. Gary Kaenzig, Jr., president of
Grace Packaging. All current officers of Sealed Air as well as
several executives of the current Grace packaging organization
will be officers of the new Sealed Air.
The board of the new Sealed Air will consist of the seven
current Sealed Air directors as well as several non-management
directors from the current board of Grace, who will resign from
the Grace board upon transaction completion.
Grace's packaging business, best known by the Cryovac
(Registered) brand, is the world's leader in packaging
materials and systems to preserve perishable foods. Cryovac
(Registered) provides value-added packaging systems, including
packaging materials, equipment, technical support and graphical
design, for a global customer base in the food, consumer goods
and industrial products industries. Other product lines
include Omicron (Trademark) rigid plastic cups and tubs for
dairy foods and Formpac (Trademark) foam trays for supermarkets
and institutional food service.
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Sealed Air is a global leader in protective and specialty
packaging materials and systems. Sealed Air's wide range of
protective and specialty packaging materials and systems
include Instapak (Registered) polyurethane foam packaging
systems, engineered polyethylene foams, Bubble Wrap
(Registered) air cellular cushioning materials, Cell-Aire
(Registered) polyethylene foam, a wide range of protective and
durable mailers, including mailers sold under the widely
recognized Jiffy (Trademark) trademark, and Dri-Loc (Registered)
absorbent pads used for retail packaging of meat, fish and
poultry.
Certain Cryovac (Registered) products, such as vacuum-
sealed food packaging, are used by customers in conjunction
with Sealed Air products, such as Dri-Loc (Registered)
absorbent pads.
THE NEW GRACE SPECIALTY CHEMICALS COMPANY
"I am enthusiastic about the future growth opportunities
for the new Grace specialty chemicals company," said Mr.
Costello. "Our new Grace specialty chemicals company will be
financially strong, and will continue to build upon its market
leadership, technological strengths, and global presence. At
the same time, we will continue our aggressive cost reduction
and capital management efforts which have proven so successful
over the past few years, leading to consistent operating margin
improvements. Furthermore, our new financial position will
allow added flexibility to invest in new product development,
geographic expansion and strategic acquisitions."
The new Grace specialty chemicals company will maintain
its headquarters in Boca Raton, Florida. Grace Davison is the
world's leading
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supplier of fluid cracking catalysts, silica-based polyolefin
catalysts and silica gels. Grace Construction Products is a
leading global supplier of specialty products to the
construction industry, including concrete additives, structural
waterproofing and fireproofing products. DAREX Container
Products is a leading supplier of container sealants and
coatings.
OTHER HIGHLIGHTS OF THE TRANSACTION
The definitive agreement is subject to customary
conditions, including approval of both companies' shareholders
and certain regulatory approvals.
The historic liabilities of Grace, including asbestos and
environmental liabilities of the non-packaging business, will
remain with the specialty chemicals company.
The shares of both the new Sealed Air and the new Grace
specialty chemicals company are expected to be listed on the
New York Stock Exchange.
COMPANY PROFILES
Grace is a leading global supplier of flexible packaging
and specialty chemicals with annual sales of approximately $3.5
billion. The company operates in more than 100 countries. To
view more information about Grace online via the World Wide
Web, visit Grace's page at http://www.prnewswire.com.
Sealed Air is engaged primarily in the manufacture and
sale of a complementary line of protective and specialty
packaging materials and systems and selected food packaging
products, and has operations in 27 countries. Sealed Air's
annual sales, which have grown over the last 20 years at an
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average annual rate of 19%, exceed $800 million. To view
Sealed Air's latest financial news online via the World Wide
Web, visit http://www.cfonews.com/see.
Safe Harbor Statement Under the Private Securities
Litigation Reform Act of 1995: The statements contained in
this release which are not historical facts, such as those
concerning future financial performance and growth, are forward
looking statements that are subject to change based on various
factors which may be beyond Sealed Air's and Grace's control.
Accordingly, the future performance and financial results of
Sealed Air and/or Grace and their respective businesses may
differ materially from those expressed or implied in any such
forward looking statements. Such factors include, but are not
limited to, those described in Grace's and Sealed Air's filings
with the Securities and Exchange Commission, as well as various
factors related to the transaction described in this release,
including the costs of integrating the businesses of Sealed Air
and Cryovac (Registered) and the realization of synergies
anticipated with respect to the transaction.
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W.R. GRACE AND SEALED AIR CORPORATION CONFERENCE CALL
FRIDAY, AUGUST 15,1997
8:30 A.M. (EASTERN)
You are cordially invited to participate in a conference call
scheduled by W. R. Grace & Co. (NYSE: GRA) and Sealed Air
Corporation (NYSE:SEE).
The conference call will take place in three parts:
8:30A.M. PART ONE: A DISCUSSION OF THE TRANSACTION
9:00 A.M. PART TWO: A DISCUSSION OF THE NEW SEALED AIR - A
HIGHLY DIVERSIFIED GLOBAL PACKAGING
COMPANY
10:00 A.M. BREAK
10:20 A.M. PART THREE: A DISCUSSION OF THE NEW GRACE SPECIALTY
CHEMICALS COMPANY
During part one, the management of the two companies will first
discuss the details of the transaction in which Grace's
packaging business will be merged with Sealed Air.
During part two, management will discuss the new packaging
company, which will be the world's leading protective and
specialty packaging enterprise. The management presentation
will be followed by a question and answer session.
During part three, which will begin at approximately 10:20
a.m., Grace's management will discuss the new Grace specialty
chemicals businesses. The management presentation will be
followed by a question and answer session.
There will be a break between parts two and three from
approximately 10:00 a.m. until 10:20 a.m., during which time
you may either place the call on hold or hang up and call in
again approximately 10 minutes prior to the start of the third
part of the call.
THE CONFERENCE CALL WILL BEGIN AT
8:30 A.M. (EASTERN TIME) ON FRIDAY, AUGUST 15,1997.
TO PARTICIPATE, PLEASE CALL (719) 448-2040
APPROXIMATELY 10 MINUTES PRIOR TO THE START OF THE CALL.
A replay of the call will be available from 3:00 p.m. (eastern)
August 15, 1997 through 8:00 p.m. (eastern) August 19, 1997 by
dialing (402) 222-9907.
If you have any questions regarding the conference call, please
contact Andrea Bergofin, Kekst and Company, (212) 521-4800.
Editor's note: The following is supplemental information
related to a news release issued earlier today about the Grace
and Sealed Air transaction.
TRANSACTION FACT SHEET
THE TRANSACTION
The Transaction has two components:
1. Prior to the merger, Grace's specialty chemicals
operations, comprised of Grace Davison, Grace Construction
Products and DAREX Container Products will be spun off to
Grace shareholders. The specialty chemicals operations
will become a separate company, which will retain the
Grace name and is expected to be listed on the New York
Stock Exchange. In addition, the transaction will be
preceded by a $1.2 billion capital contribution to the new
Grace specialty chemicals company, which will use the cash
to pay down substantially all of its debt.
2. Grace's packaging business will be merged with Sealed Air
to create the world's leading protective and specialty
packaging company. This company will be named Sealed Air,
and its shares are expected to be listed on the New York
Stock Exchange.
KEY TRANSACTION POINTS
The transaction will be tax-free to both Grace and Sealed
Air and their respective shareholders
Grace shareholders will own 63% on a fully diluted basis
of the new Sealed Air and will retain ownership of 100% of
the new Grace specialty chemicals company
Sealed Air shareholders will own 37% on a fully diluted
basis of the new Sealed Air packaging company
Transaction value to Grace shareholders of approximately
$5 billion:
$1.9 billion in common stock of the new Sealed Air
(40.9 million common shares of the new Sealed Air)
$1.8 billion in new convertible preferred stock (36.0
million convertible preferred shares, convertible
into approximately 31.8 million common shares)
$1.2 billion cash contribution to the new Grace, to
be used to pay down substantially all of its debt
Excluding the effect of transaction and integration costs,
the transaction is expected to be accretive to Sealed
Air's earnings per share going forward.
The new Grace specialty chemicals company will be a
substantially debt-free company.
Editor's note: The following is supplemental information
related to a news release issued earlier today about the Grace
and Sealed Air transaction.
THE NEW GRACE SPECIALTY CHEMICALS COMPANY
Chairman, President and CEO: Albert J. Costello
Pro Forma Revenues: Approximately $1.5 billion
Employees: 6,000 worldwide
Headquarters: Boca Raton, Florida
The new Grace specialty chemicals company will consist of Grace
Davison, a leading global supplier of fluid cracking catalysts,
silica-based polyolefin catalysts and silica gels; Grace
Construction Products, a leading global supplier of specialty
products to the construction industry; and DAREX Container
Products, a leading supplier of container sealants and
coatings.
GRACE DAVISON CATALYSTS AND SILICA PRODUCTS - Annual sales of
more than $730 million. Headquartered in Baltimore, Maryland,
employs 2,700 people worldwide.
Grace Davison is the world's leading supplier of petroleum
fluid cracking catalysts used to refine crude oil into
transportation fuels and other petroleum-based products. It
also is expanding its market position in hydroprocessing
catalysts used to remove impurities from crude oil prior to the
use of petroleum cracking catalysts. Grace Davison's
polyolefin catalysts are critical in the manufacture of
polyethylene resins for plastic film, gas distribution pipe and
household containers. More than one-third of the world's
polyethylene production relies on Grace Davison polyolefin
catalysts.
Grace Davison also is a leading global supplier of silica
products and zeolite adsorbents, which are used to improve the
performance of plastic films, coatings, pharmaceuticals,
cosmetics, multi-pane window systems, dentifrices, powdered
foods, edible oils and high-quality papers.
Grace Davison technology focuses on innovations in polymeric
systems, catalysis, silica-based systems and environmentally
compatible fluid cracking catalysts for cleaner-burning fuels.
GRACE CONSTRUCTION PRODUCTS - Annual sales of more than $450
million. Headquartered in Cambridge, Massachusetts, employs
1,900 people worldwide.
Grace Construction Products manufactures and sells construction
products worldwide to meet critical performance requirements.
Its concrete admixtures, cement additives, masonry products,
fire protection products and waterproofing materials perform
some of construction's most vital jobs - they strengthen
concrete, fight corrosion, prevent water damage and protect
structural steel against collapse in the event of fire.
Research and development efforts focus on designing products
that add measurable
value by significantly enhancing performance, for example,
enhancers that create higher strength concrete.
DAREX CONTAINER PRODUCTS -- Annual revenues of approximately
$320 million. Headquartered in Lexington, Massachusetts,
employs approximately 1,400 employees worldwide.
DAREX Container Products is the world leader in can sealing and
bottle crown technology. DAREX container sealants are vital to
the safety and sealing integrity of more that 450 billion cans
and bottles each year. Grace's innovative oxygen-absorbing
technology maintains food and beverage quality - without
preservatives - and increases shelf life to help customers
reduce product rotation and distribution costs.
RECENT HIGHLIGHTS
Grace has implemented numerous changes over the past two years
that have enabled the Company to enhance performance while
focusing on profitably growing its global businesses, including
the packaging business being merged with Sealed Air.
Prior to this transaction, Grace has emerged as an integrated,
global operating company, dedicated to continuously improving
its product portfolio and its financial performance.
Achieved record sales and earnings in each of its core
businesses in 1996.
Divested noncore businesses, including National Medical
Care, Dearborn, Grace Cocoa, Grace's TEC metal catalysts
business, Grace Specialty Polymers, Amicon and Agracetus.
Significantly improved the capital structure of Grace by
using more than $3.5 billion in investment proceeds to
significantly reduce debt and repurchase shares.
Repurchased 28 million shares of Grace common stock in
1996 and 1997.
Reduced annual costs by more than $100 million and
instituted rigorous financial and working capital
controls.
GRACE DAVISON
Announced plans to commercialize a new catalyst in 1997 to
reduce nitrogen dioxide emissions from refineries.
Increased hydroprocessing catalyst production capabilities
by expanding Curtis Bay, Maryland facility in 1996; also
began construction of new Lake Charles, Louisiana,
scheduled to begin operation in 1998.
Started up new Kuantan, Malaysia silicas plant to provide
regional silica products manufacturing capability in the
Asia Pacific region.
GRACE CONSTRUCTION PRODUCTS
Achieved record three-fold improvement in pretax operating
income and 10% sales growth in 1996.
Increased sales of new and enhanced products nearly 35% in
1996, representing over 25% of total construction products
sales.
Acquired the cement additives business of Imporextran
Quimica S.A. of Barcelona, Spain, and the concrete
admixtures manufacturing assets of CSR Limited in
Australia.
Introduced innovative Eclipse (Registered) shrinkage-
reducing concrete admixture to minimize concrete cracking.
Introduced Polarset (Registered) noncorrosive set
accelerator to enable customers to pour and work concrete
in cold temperatures without using corrosion-causing
chemicals.
Introduced Vycor Ultra (Trademark) self-adhered roofing
underlayment for commericial use to protect against ice
dams and wind-driven rain.
Trained 100% of its workforce in quality management
techniques.
DAREX CONTAINER PRODUCTS
Introduced patented oxygen-scavenging technology worldwide
for beer bottle crowns.
Acquired Bayem S.A. de C.V. in Mexico, providing greater
access to the rapidly growing Latin American can closure
and sealants market.
Formed joint venture with Shalimar Paints Ltd. in India to
produce and market container coatings, closures and can
sealing compounds.