Clariant And Huntsman Will Merge

May 23, 2017
The merger will create a global specialty chemical company with approximately $20 billion enterprise value.

The Boards of Directors of Clariant and Huntsman Corporation unanimously approve 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 merger will reportedly create a global specialty chemical company with sales of approximately $13.2 billion, an adjusted EBITDA of $2.3 billion and a combined enterprise value of approximately $20 billion at announcement.

Transaction highlights include:

  • Clariant shareholders: 52%, Huntsman shareholders: 48%
  • Huntsman shareholders receive 1.2196 shares in HuntsmanClariant for each Huntsman share (each existing Clariant share will remain outstanding as a share in HuntsmanClariant)
  • Board of Directors with equal representation from Clariant and Huntsman
  • Global headquarters in Pratteln, Switzerland, operational headquarters in The Woodlands, Texas
  • Dual stock exchange direct listing on the SIX Swiss Exchange and the New York Stock Exchange

The combined company expects to realize more than $3.5 billion of value creation from approximately $400 million in annual cost synergies, according to Clariant. The full synergy run-rate will reportedly be achieved within two years of closing. The targeted synergies represent roughly 3% of total combined 2016 revenue with one-time costs up to $500 million. There will also be additional cash-tax savings, according to Clariant.

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, will 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, will become chairman emeritus and board member of HuntsmanClariant. The company will be listed on the SIX Swiss Exchange and the New York Stock Exchange. HuntsmanClariant will use IFRS, and beginning in Q1 2018 will report in USD and will start filing 10Qs and 10Ks consistent with SEC requirements.

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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