H.B. Fuller divests flooring business, adds two medical adhesive firms

ST. PAUL, Minn.—Global chemical distributor H.B. Fuller Co. is divesting its flooring business and acquiring two medical adhesive firms, as the company realigns its building and construction market segments into a larger global business unit.

The pureplay adhesives firm with $3.5 billion in annual net sales sold its flooring business for $80 million Dec. 2 to Los Angeles-based Pacific Capital Partners, a private equity company.

The sale is expected to result in the loss of about $160 million in annual revenue and adjusted EBITDA of approximately $15 million going forward, according to H.B. Fuller.

"This move is consistent with our strategy to drive our portfolio and capital allocation to the highest-margin, fastest-growing segments of the $80 billion global adhesives industry," said H.B. Fuller President and CEO Celeste Mastin. "With Pacific Avenue Capital Partners, we have found the right home for our talented Flooring team and brand-recognized products."

The same day, H.B. Fuller announced the planned acquisition of Italy-based GEM S.r.L, set to close in February 2025; and Medifill Ltd. of Dublin, Ireland, a sale that closed Dec. 2.

Combined, the two medical adhesive technology companies were purchased by H.B. Fuller for $189 million.

"Each of the transactions announced ... furthers our goal to deliver an adjusted EBITDA margin of greater than 20 percent in the next two to four years," an H.B. Fuller spokesperson told Rubber News Dec. 3. "As part of our next level approach to portfolio management, we have identified our top 20 technology-based growth market segments. This list includes medical adhesive technologies.

"It does not include flooring."

The medical adhesive companies offer a greater European foothold for H.B. Fuller and are expected to generate combined annual revenue of $24.2 million, with an adjusted annual EBITDA of $12.1 million.

"Tissue adhesives designed for internal use offer innovative alternatives to traditional sutures, staples and embolizing agents," Mastin said. "With the purchase of GEM, Medifill and our previous acquisitions in this space, H.B. Fuller has now built a medical adhesive technologies business founded on our expertise in cyanoacrylate chemistry, and we have extended our penetration into a global footprint."

H.B. Fuller, in the second day of its new 2025 fiscal year Dec. 2, launched the new Building Adhesives Solutions global business unit (without flooring), a combination of the company's insulated glass, woodworking and composite segments (which had been part of Engineering Adhesives); and its roofing and building envelope and infrastructure (BE&I) segments.

Moving forward, the three official GBUs for H.B. Fuller will be the BAS GBU, which replaces the Construction Adhesives GBU; Engineering Adhesives GBU; and Hygiene, Health and Consumable Adhesives (HHC) GBU.

"(BAS) will create a faster-growing solutions business with a complementary customer base across the architectural and infrastructure markets," H.B. Fuller said. "BAS features a larger scale GBU designed to capture growth in the burgeoning global infrastructure market, including energy, utilities and data management applications, and capitalize on H.B. Fuller's existing position in the global architectural market."

Combining the annual net revenue from the reorganized segments, BAS is expected to generate about $850 million in net sales and $130 million in adjusted EBITDA in 2024.

Neither full-year financial results nor fourth quarter financial results have been released by H.B. Fuller.

BAS will be led by Shahbaz (Boz) Malik, senior vice president, BAS.

The planned purchase of GEM, a provider of medical adhesives and devices approved for more than 80 internal applications, establishes a European headquarters for H.B. Fuller's Medical Adhesive Technologies business and expands the company's medical adhesive offerings.

Medifill Ltd. formulates and produces medical-grade cyanoacrylate adhesives, and boasts a clean room and manufacturing capabilities.

Medifill's technologies are tailored for the wound closure market, "enabling fast, safe and effective wound closure," H.B. Fuller said in a Dec. 2 release on the acquisition.

"These acquisitions build upon H.B. Fuller's previous investments in the tissue adhesives market—including the acquisition of Cyberbond in 2016, Tissue Seal in 2021 and Adhezion Biomedical in 2023—significantly expanding the company's global Medical Adhesive Technologies business and geographic footprint," H.B. Fuller said.

The two companies will exist (when the GEM transaction is finalized) under the auspices of the HHC Adhesives GBU.

Rounding out the acquisition front during a busy buying year, H.B. Fuller acquired HS Butyl Ltd., the U.K.'s largest manufacturer and distributor of butyl tapes, expanding H.B. Fuller's position in the global waterproofing tape market.

The butyl tapes "provide strong, permanent, watertight seals" for an array of applications within the construction, infrastructure, automotive and renewable energy industries, H.B. Fuller said.

Terms of the Aug. 24 acquisition were not disclosed.

HS Butyl is a family-owned business that has been designing, engineering and manufacturing butyl tape from its headquarters in Lymington, England, since its founding in 1964.

With more than $23 million in annual sales, HS Butyl exports to more than 50 countries around the world.

The business will operate within the BAS GBU.

HS Butyl will be lateral to GSSI Sealants Inc., a North American producer of butyl tapes that H.B. Fuller acquired in 2022. According to Mastin, the European waterproofing tape market is twice the size of the North American market.

Other bolt-ons included the May 20 purchase of ND Industries, a supplier of specialty adhesives, fastener locking and sealing solutions that serves customers in the automotive, electronics, aerospace and other industries.

The Detroit-based ND Industries operates with facilities in the U.S. and Asia. The 300-person company is expected to see sales of about $80 million this year.

This company will operate within H.B. Fuller's Engineering Adhesives GBU.

Founded in 1887, H.B. Fuller had revenue of $3.5 billion in 2023 and about 7,500 employees.