Elementis PLC has responded to an open letter from Franklin Mutual Advisers, in which Franklin requested the immediate sale of the company. The board of Elementis engages with and welcomes feedback from all shareholders and is focused on delivering value for stakeholders. After careful consideration, the board, with the support of its advisors, does not believe an immediate sale of the company is in the best interests of its shareholders.
The board agrees with Franklin's comments on Elementis' attractive assets, including its healthy market positions, strong gross margins, and potential for upside in a cyclical recovery. Elementis is now a pure play specialty chemicals business focused on adding value to customers' formulations. The company aims to achieve its medium-term goal of a 17% adjusted operating margin and a net debt/EBITDA ratio below 1.5x.
Elementis delivered resilient results in its 2023 interim report, despite challenging macro-economic conditions. The company continues to execute its strategy, which is centered around innovation, growth, and efficiency. The board regularly considers strategic alternatives with its financial advisors.
The board does not believe that Franklin's request for an immediate sale of the company is currently in the best interests of shareholders. The company plans to update shareholders on its strategic progress, including growth and efficiency initiatives, at its upcoming Capital Markets Day on November 14, 2023.