Clariant, Huntsman to merge, creating $20-B enterprise
MUTTENZ, Switzerland — Clariant and Huntsman Corporation announced that their Boards of Directors unanimously approved a definitive agreement to combine in a merger of equals through an all-stock transaction.
The merged company will be named HuntsmanClariant. On a pro forma 2016 basis, the combination of both companies will create a leading global specialty chemical company with sales of approximately $13.2 B, an adjusted EBITDA of $2.3 B and a combined enterprise value of approximately $20 B at announcement.
“This is the perfect deal at the right time. Clariant and Huntsman are joining forces to gain much broader global reach, create more sustained innovation power and achieve new growth opportunities,” said Hariolf Kottmann, CEO of Clariant. “This is in the best interest of all of our stakeholders. Peter Huntsman and I share the same strategic vision and I look forward to working with him.”
The combined company expects to realize more than $3.5 B of value creation from approximately $400 MM in annual cost synergies. The full synergy run-rate will be achieved within 2 yr of closing. These synergies will be realized by reducing operational costs and improving procurement. The targeted synergies represent roughly 3% of total combined 2016 revenue with one-time costs up to $500 MM. There will also be additional cash-tax savings.
The combined company, incorporated in Switzerland, will be governed by a Board of Directors with equal representation from Clariant and Huntsman and will follow Swiss Corporate Governance standards. Hariolf Kottmann, current Clariant CEO, shall become Chairman of the Board of HuntsmanClariant. Peter Huntsman, current Huntsman President and CEO, will become CEO of HuntsmanClariant. Jon Huntsman, founder and Chairman of Huntsman, shall become Chairman Emeritus and board member of HuntsmanClariant.
The transaction is targeted to close by year end 2017, subject to Clariant and Huntsman shareholder approvals, regulatory approvals and other customary closing conditions.
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