US – Trelleborg Group has agreed to buy KKR’s Minnesota rubber and plastics (MRP), a leading provider of materials science-based elastomer and thermoplastic solutions for US$950 million.

The transaction, which is subject to customary regulatory approvals, is expected to close before year-end 2022.

Minnesota rubber and plastics (incorporated under the name Quadion) previously acquired by KKR in November 2018, has made significant progress in driving growth and operational excellence.

Under KKR’s ownership, MRP has completed acquisitions adding complementary new capabilities in the U.S. and U.K. and awarding shared ownership to all employees of the acquired businesses.

MRP is the latest example of KKR’s focus on employee ownership and engagement as a key driver in building stronger companies and driving greater financial inclusion.

KKR introduced a broad-based employee ownership program for MRP employees as a free, incremental benefit and not in exchange for benefits, wages or wage increases (wages increased over 6% annually during KKR’s investment period).

Other pillars of the broad-based employee ownership program included sharing business targets and regular progress updates with all employees and giving employees a voice in capital expenditures and operational improvements.

All of MRP’s more than 1,450 employees across six countries and four U.S. states, including hourly manufacturing production, technical and administrative employees, will receive cash payouts upon closing of the transaction, with payouts varying based on tenure and employment status.

As part of the transaction, employees will receive pre-paid personal financial coaching and tax preparation services.

Financial planning advice will be provided by Goldman Sachs Ayco Personal Financial Management in the U.S. and by RSM Global for international employees. Deloitte will provide tax services globally.

“I am proud to have worked alongside MRP colleagues who have contributed in so many ways to the Company’s performance. Together we have been able to deliver the fantastic results that made this sale possible,” said Josh Weisenbeck, Partner at KKR who leads KKR’s Industrials private equity team.

“This is a great outcome for all employee owners and our limited partners in KKR’s Americas XII Fund.”

To date, KKR has awarded billions of total value through broad-based equity programs to over 45,000 non-senior employees across over 25 companies.

In April 2022, KKR joined more than 60 leading organizations in becoming a founding partner of Ownership Works, a non-profit created to support public and private companies transitioning to shared ownership models.

KKR and MRP were advised by Houlihan Lokey as financial and M&A advisor, and Kirkland & Ellis as legal advisor on the transaction.

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