Solstice Advanced Materials and Element Solutions announced that they have entered into a definitive agreement for Solstice to acquire Element Solutions. The cash-and-stock transaction is valued at approximately $14.5 billion, including the assumption of net debt.
The transaction is designed to accelerate Solstice’s strategy of building an advanced materials platform with greater exposure to electronics, AI infrastructure, thermal management, data center cooling, and other specialty markets. The combined company will operate under the Solstice name after closing.
Element Solutions adds electronics, formulation, technical service, and customer co-innovation capabilities that complement Solstice’s strengths in chemistry, application development, refrigerant application solutions, and high-performance materials. Together, the companies are expected to create a broader platform serving semiconductor fabrication, advanced packaging, assembly, and other high-growth electronics markets.
On a combined basis, Solstice and Element Solutions would have generated full-year 2025 net sales of about $6.8 billion. The combined business is also expected to have a 26% adjusted EBITDA margin, including run-rate synergies.
Solstice said the deal broadens its role across AI infrastructure by connecting electronics, packaging, and thermal management capabilities with data center cooling and refrigerant application solutions. The combined platform is expected to support customers across advanced computing, including higher-performance chips, packaging architectures, and cooling solutions designed to improve efficiency and reliability.
The company also expects to retain attractive specialty positions, including serving as the sole U.S. supplier of uranium conversion services that support the nuclear fuel cycle. Solstice said the combination should strengthen its long-term growth, margin, and cash flow profile.
Solstice expects the combined company to deliver mid-to-high single-digit compound annual revenue growth over the medium term. It also expects high single-digit to low double-digit compound annual adjusted EBITDA growth and cash conversion of about 75%.
The company expects to realize more than $180 million of net synergies by the third year after closing. These synergies are expected to come from procurement efficiencies, manufacturing optimization, supply chain optimization, operational efficiencies, and SG&A savings.
The transaction is expected to be accretive to adjusted EPS in the first year after closing. Solstice also expects the combined company to have net leverage of about 3.5 times at closing and to reduce leverage to below 3 times adjusted EBITDA within 18 months.
Under the terms of the agreement, Element Solutions shareholders will receive $10 in cash and 0.500 shares of Solstice common stock for each Element share. This represents implied consideration of about $50.10 per Element share and a premium of about 15% over Element’s closing share price on July 2, 2026.
Upon closing, Element Solutions shareholders are expected to own about 44% of the combined company. Solstice President and CEO David Sewell will serve as President and CEO of the combined company.
The boards of both companies unanimously approved the transaction. The deal is expected to close in the first half of 2027, subject to customary closing conditions, including regulatory approvals and shareholder approvals.
Solstice has secured fully committed financing for the transaction through an initial $4.7 billion bridge commitment from Goldman Sachs. The company plans to replace the bridge commitment with permanent debt financing and use that financing, along with cash from its balance sheet, to fund the cash consideration.
Goldman Sachs is serving as lead financial advisor to Solstice, alongside PJT Partners. Consello also provided advisory services to Solstice, while Davis Polk & Wardwell and Hogan Lovells are serving as M&A counsel.
BofA Securities is serving as financial advisor to Element Solutions. Paul, Weiss, Rifkind, Wharton & Garrison is serving as legal counsel, and Collected Strategies is serving as strategic communications advisor.
KEY QUOTES:
“Overall, we believe the combined company will be very well-positioned to benefit from generational tailwinds in high-growth end markets. Element brings highly complementary capabilities, deep customer relationships and a technical service-led model that expands how we support customers from early-stage development through high-volume manufacturing. This high-performing team brings with it inimitable domain expertise and customer process know-how in addition to a compelling track-record of value creation for shareholders. Together, we expect Element and Solstice to be extremely well positioned to deliver on our customers’ growing requirements for signal integrity, thermal management, reliability and performance.”
“Both companies have strong cultures grounded in integrity, innovation, teamwork and customer focus, with comprehensive patent portfolios and highly talented employees who are at the top of their profession. We intend to blend the best of our talents and cultures to build an organization with a broader technology platform and a stronger ability to co-innovate with customers to develop unique solutions addressing emerging, complex requirements from our combined customer base.”
“This transaction allows us to amplify our transformational growth in electronics while building on the strength of Solstice’s existing businesses. Our refrigerant application solutions platform, including data center cooling, and our specialty exposures such as nuclear fuel remain core to the combined company’s value proposition and central to helping customers improve efficiency, resilience and performance. Together, we aim to create a higher growth, higher margin advanced materials leader with greater global reach. I am confident we will successfully integrate our teams by taking a best-of-both approach, building on our respective strengths, and creating an even stronger organization.”
David Sewell, President and CEO of Solstice
“Since Element’s founding in 2019, we have delivered a strategy balancing operational excellence and prudent capital allocation to cement our position in the fastest growing, highest value niches of our markets. This transaction recognizes that achievement and brings together two great companies with shared attributes — strong market positions, attractive margins, deep technical know-how and excellent people — to accelerate their combined growth. We are creating a scaled advanced materials platform with complementary capabilities to broaden our offerings in our core electronics markets and deliver differentiated solutions to customers. We believe that the breadth of the combined portfolio along with enhanced innovation and manufacturing capabilities will allow us to better solve the pain points emerging in the leading edge of the electronics industry. This is an exciting opportunity for our people and shareholders, both of whom are expected to participate in the anticipated long-term upside of the combined company.”
Ben Gliklich, CEO of Element Solutions
