UPDATE 2-Cytec selling coatings business to Advent for $1.03 bln
* Cytec to use some proceeds for share repurchases
* Advent to assume $118 mln of liabilities
Oct 9 (Reuters) - Cytec Industries Inc is selling its coating resins business to private equity firm Advent International for $1.03 billion and will use some of the proceeds for share buybacks.
News of the deal, announced Tuesday, comes five months after the specialty chemicals maker started a sale process prompted by falling demand in Europe and rising costs.
Coating products, which include varnishes and specialty paints, contributed half of Cytec's sales of about $3 billion in 2011. The company is increasing its focus on the higher-margin engineered materials, process separation and additive technology segments. In April, it announced plans to buy Britain's Umeco Plc for $439 million.
Advent will pay $1.03 billion for the coatings business and also assume liabilities of $118 million, said Cytec, based in Woodland Park, New Jersey.
Cytec also said its board authorized an additional $452 million for its stock repurchase program, taking its total authorization to $650 million. The program will be partly funded by proceeds from the coatings business sale.
The sale is expected to close in the first quarter of 2013, Cytec said. JPMorgan advised Cytec on the deal.
Cytec initiated the process of selling its coating resins business in May, the same month it sold its self-adhesive business to German consumer goods company Henkel for $105 million.
Cytec stock closed at $64.70 on the New York Stock Exchange on Monday.