2003/5/9@Huntsman
Huntsman Buys Out Minority Interests
In Huntsman International Holdings
Jon M. Huntsman, Founder and
Chairman, and Peter R Huntsman, President and CEO, of the
Huntsman companies today announced the purchase of ICI's debt and
equity holdings in Huntsman International Holdings LLC (HIH), and
the additional purchase of two financial institutions' minority
interest in HIH.
(Note: Huntsman International was formed when Huntsman purchased a majority stake
in ICI's industrial chemical business)
With the buyouts, HMP Equity Holdings
Corporation (HMP), which is
controlled by the Huntsman family, now owns 100% of all principal Huntsman
business entities.
(Note: HMP Equity HoldingsF51% owned by the Huntsman family and 49%
owned by New York private equity firm MatlinPatterson )
The purchases were accomplished by
HMP issuing Senior Discount Notes with warrants. The $315 million
of cash proceeds were used to complete the purchase from ICI of
its 30% interest in HIH, and HIH Senior Subordinated Discount
Notes (accreted to $366 million). Approximately $90 million of
the notes and warrants were exchanged for the 9% interest in HIH
currently held by JP Morgan Partners and MidOcean Capital
Investors.
Mr. Jon Huntsman commented,
"This is a momentous event in our companies' history. The
buyout of ICI's and others' minority interests in HIH is the
final step of a financial restructuring that we began in January
of 2002. We have realized its successful completion in spite of
severe economic uncertainties and extremely high energy prices. I
pay tribute to our management and finance teams for their
professionalism and tenacity in accomplishing this major
undertaking. Together with our partner, MatlinPatterson, we are
extremely positive about the future of our companies."
Mr. Peter Huntsman said, "These
buyouts enable us to move forward without the concerns and
constraints of the past. We feel we now will be able to compete
more effectively in the global marketplace and, importantly, to
take full advantage of opportunities for growth that may present
themselves."
The combined Huntsman companies
constitute the world's largest privately held chemical company.
The operating companies manufacture basic products for a variety
of global industries including chemicals, plastics, automotive,
footwear, paints and coatings, construction, high-tech,
agriculture, health care, textiles, detergent, personal care,
furniture, appliances and packaging. Originally known for
pioneering innovations in packaging, and later, rapid and
integrated growth in petrochemicals, Huntsman-held companies
today have more than 13,000 employees, facilities in 44 countries
and had 2002 revenues of more than $7 billion.
Platts 2002/9/30
Huntsman completes financial restructuring
Huntsman Corp reported Monday the completion of its financial
restructuring. The initiative reduces Huntsman debt by about
$775-mil and "leaves the Huntsman family with operational
and board control," the company said. "That transaction
will result in further debt reduction to the combined Huntsman
companies," the company said. The Huntsman family reported
in June 2002 that MatlinPatterson Global Opportunities Partners,
the company's largest bond holder, had agreed to exchange its
bonds and make a contribution of certain assets, for a 49.9%
equity stake in a newly established holding company. The holding
company would own the stock of Huntsman and certain debt
securities in Huntsman International Holdings. The bank group
subsequently gave unanimous approval to the deal.
Huntsman Corporation@@@@@http://www.huntsman.com/
Huntsman Corporation is the
world's largest privately held chemical company. Its operating
companies manufacture basic products for a variety of global
industries including chemicals, plastics, automotive, footwear,
paints and coatings, construction, high-tech, agriculture, health
care, textiles, detergent, personal care, furniture, appliances
and packaging.
Businesses:
Huntsman's six major businesses manufacture and market over 33 billion pounds of product each year.
Performance Chemicals
Petrochemicals
Polymers
Polyurethanes
Surface Sciences
Tioxide
Petrochemicals
Huntsman's worldwide petrochemicals operations are made up of three major regional businesses in the Americas, Europe and Asia Pacific.
Each regional business manufactures a large and diverse range of base commodity chemicals for the petrochemicals and plastics industries and these form the building blocks for a vast range of products which are essential to everyday life.
The large quantities of petrochemicals we manufacture are distributed to customers throughout North America, Central and South America, the UK, Europe, Australia, New Zealand and the Southern Pacific.
Huntsman annually produces more than 4 billion pounds of ethylene and 2 billion pounds of propylene. Ethylene is the petrochemical industry's most basic building block. For sale in the merchant market, the ethylene produced by Huntsman is used in a myriad of consumer products such as detergents, cosmetics, textiles and antifreeze, as well as internally for the production of ethylene oxide and derivative products.
Propylene, another chemical building block, is also used internally to create propylene oxide, acrylonitrile, cumene and polypropylene. Manufacturing uses include furniture and bedding, batteries, automobile interiors, carpeting, clothing, appliances, toys and packaging. Additional base chemicals produced by Huntsman include butadiene and cyclohexane.
Intermediate chemicals produced by Huntsman include ethanolamines and alkylalkanolamines. These chemicals, in addition to ethylene oxide, ethylene glycol, and styrene monomer, are used in the production of such diverse products as paints, wrinkle-resistant clothing, audio and videotapes, gasoline additives, and furniture seat cushions. Huntsman is one of North America's largest producers of these chemicals.
Huntsman's Petrochemicals operations are part of the Huntsman Corporation group of businesses.
@tr`
Odessa, Texas
Polypropylene
Utilizing Huntsman's proprietary Liquid Pool process, this facility produces product with an excellent balance of properties, from impact copolymers to specialty grades. Products made at this facility are some of the purest polypropylene available and are used in demanding medical and electrical applications throughout the world.
Polyethylene
Huntsman's proprietary and licensed technologies provide our customers with some of the highest quality and consistent grades of polyethylene available. Huntsman's polyethylene facility produces a wide variety of products from High Pressure Low Density to REXell Octene Linear Low Density.
The REXell Linear Low Density Polyethylene plant utilizes the DSM Compact process. This process makes very consistent products and is capable of making rapid transitions, allowing Huntsman to make grades that precisely fit customer requirements. This plant is capable of manufacturing Octene Linear Low Density, Butene Linear Low Density and High Density Polyethylene.
The High Pressure Low Density facility produces a wide range of products on multiple tubular and autoclave reactors. Our HPLDPE is made with Huntsman's proprietary process that allows for quick transitions and makes very consisent products while meeting very specific customer requirements including industry leading low gel materials. Our product range covers fractional melt flow homopolymer, extrusion coating grades, EVA copolymers, and low gel film grades.Port Arthur, Texas
Huntsman Corporation's Jefferson County Operations (JCO) employs 1400 associates.
JCO has four main sites: Oxides & Olefins , C4, PO/MTBE Plant, all in Port Neches; and Aromatics & Olefins in Port Arthur. Despite the distance between the plants, all four are closely integrated with a network of pipelines, allowing for transfer of feedstock and products from one plant to another, resulting in a very efficient operation. JCO is located approximately 100 miles east of Houston, Texas.
The A&O Plant in Port Arthur covers a land area of 229 acres and employs approximately 250 associates. Three major products are made here: ethylene, propylene, and cyclohexane. The Light Olefins Unit can produce 1.3 billion pounds per year of ethylene and over 600 million pounds per year of propylene. The cyclohexane unit can produce up to 70 million gallons per year.Port Neches, Texas
The C4 Plant in Port Neches covers a land area of 585 acres and employs approximately 250 associates. Two major products here are butadiene and MTBE (methyl tertiary butyl ether.) The plants have a capacity to produce 750 million pounds per year of butadiene and 3.8 barrels per year of MTBE.
The Oxides & Olefins Plant in Port Neches cover a land area of 2400 acres and employs approximately 450 associates. A wide variety of products are made here: ethylene, propylene, ethylene oxide, ethylene glycol, propylene glycol, ethanolamines, surfactants, morpholine, diglycolamine, and other smaller by-products.
Alongside the O&O plant is the PO/MTBE plant. The PO/MTBE Plant covers a land area of 195 acres and employs approximately 150 associates. The plant can produce 400 million pounds of propylene oxide and 2.2 billion pounds of MTBE per year.
@@Europe
Huntsman European Petrochemicals is a major manufacturer of bulk commodity chemicals. These provide the key raw materials for a vast range of end products, which are essential for today's modern lifestyles.
Our production facilities comprise:Ethe Olefins business, manufacturing ethylene, propylene and butadiene on the world-scale Olefins 'Cracker' plant at the Wilton International Site. From here, we also store and distribute products and feedstocks via ship and cross-country pipelines.
Ethe Aromatics business, manufacturing benzene, ethyl benzene, xylenes, cyclohexane and cumene at our North Tees Site and Paraxylene at Wilton International.
Eat North Tees, we also manufacture brine, operate ethylene liquefaction facilities and store feedstocks
and products for distribution by road and ship.
These manufacturing operations are highly integrated and closely linked in terms of both feedstocks and finished products.Huntsman European Petrochemicals came into existence on 1 July 1999 when the business was purchased by Huntsman Corporation from ICI as part of a major acquisition which also included the Polyurethanes and Tioxide global operations.
Virtually all of the European Petrochemicals manufacturing operations are based at two large chemical complexes on Teesside, UK - Wilton and North Tees sites.
@ ANZ
Huntsman Chemical Company Australia (HCCA) Pty Limited's origins go back to 1928 and the founding of the Monsanto Southern Cross Chemical Company.
Huntsman Chemical Company Australia manufactures and distributes a diverse range of plastics and chemicals -Styrene Monomer
Polystyrene
EPS
Polyester Resins
Gelcoats
Phenol, Acetone and Cumene Hydroperoxide
Phenolic Resins
Phenolic Laminating Resins
Other Petrochemicals
Chemical Week 2002/6/25
Huntsman Restructures Debt; Family
to Cede 49.9% Stake
By Robert Westervelt
Huntsman Corp. has agreed to a financial restructuring with its
largest bondholder that includes the exchange of most of its outstanding
bond debt for a 49.9% stake in the Huntsman family's chemical
holdings. "This is a
major accomplishment that will successfully bring Huntsman Corp.
through some of the worst economic conditions in the history of
the chemical industry," says
Huntsman CEO Peter Huntsman. Huntsman founder and chairman Jon
Huntsman termed the experience "the most painful we've ever
encountered".
The Huntsman family will retain majority ownership and operating
control of the Huntsman companies, which include Huntsman Corp.
and Huntsman International. Huntsman Corp. announced last
November that it would stop interest payments on its bonds and
restructure debt with bondholders. Depressed demand and soaring
feedstock costs in 2001 sent Huntsman's results into the red,
leaving the company unable to support its $2-billion-plus debt
load.
Huntsman
International, formed when
Huntsman purchased a majority stake in ICI's industrial
chemical business, has
performed relatively well under a separate financing facility and
continued to make bond interest payments.
Credit Suisse First Boston's Global Opportunities Partners ( GOP)
fund, which accumulated 82% of Huntsman Corp.'s outstanding
bonds, plans to cancel its bond holdings and has agreed to
contribute $160 million in cash toward Huntsman's planned
purchase of ICI's 30% stake in Huntsman International. The
Huntsman family now owns 60% of Huntsman International and
previously agreed to pay a total of $365 million for ICI's stake.
GOP, in exchange, will receive a 49.9% stake in a holding company
that will control all of Huntsman Corp. and Huntsman's 90% stake
in Huntsman International. The remaining 10% stake in Huntsman
International is owned by a consortium of banks consisting of
Deutsche Bank (New York), Goldman Sachs (New York), and J.P.
Morgan Chase (New York). "We look forward to supporting the
Huntsman family in executing its strategic vision for the
Huntsman companies under a deleveraged capital structure,"
says David Matlin, director of the
GOP fund.
Huntsman says that its lead lender, Deutsche Bank, has approved
the deal, and that a committee representing the other banks has
indicated that it will approve the deal.
The face value of the bonds held by GOP is estimated at $700
million, but the fund has accumulated Huntsman Corp. bonds at a
fraction of that cost over the past few months, market sources
say. GOP declined to disclose its purchase price.
One analyst says that Huntsman Corp. bonds traded for as low as
10 cents on the dollar in late 2001 and traded between 25 cts-35
cts in early June, before the debt-for-equity swap was announced.
GOP's other chemical industry holdings include Polymer Group
(North Charleston, SC).
In addition to its 30% stake in Huntsman International, ICI has
agreed to surrender subordinated bank notes, valued at more than
$400 million, due in 2009. ICI says it will receive total
proceeds of 305 million
($440 million) before interest. ICI says it has already received
the $160 million in cash from GOP. Huntsman International is
expected to provide the balance, plus interest, by May 15, 2003.
ICI agreed late last year to delay Huntsman's scheduled purchase
of ICI's Huntsman International stake until third-quarter 2003,
from first-quarter 2002, because of Huntsman's financial
problems.
"This is a very good deal for ICI and its
shareholders," says ICI
chief executive Brendan O'Neill. "It delivers excellent
value overall, enables us to turn part of our investment into
cash now and get the remainder earlier than previously
anticipated."
Huntsman says the deal reduces the
overall debt level of the Huntsman companies by 20% and insures a
financial structure that will protect it against future
downturns. "This will allow us to weather a trough similar
to where we've been in the past 12 months and still generate
positive cash flow," says
Peter Huntsman. "Last year, the company would have been cash
flow positive with the structure we're putting in place now, with
the exception of the two months in early 2001 where natural gas
prices soared to $10/million btu."
Huntsman says the lower interest
payments and a $250-million-plus cost-cutting effort should boost
normalized earnings before interest, taxes, depreciation, and
amortization by $350 million, to $1.6 billion/year.
April 16, 2003 Financial Times
Huntsman to build world's largest LDPE plant in the UK.
Huntsman is to build a 375,000-400,000 tonnes/y, EUR 200 M - EUR
220 M, low density polyethylene (LDPE) plant in Wilton, Teeside,
UK, which would be the largest in the world. The company is
discussing the project with 3 providers of technology and expects
to come to a decision by the end of Apr 2003. The main technology
providers for LDPE are Basell, Equistar, ExxonMobil, Polimeri
Europa and Sabtec.
Huntsman makes 800,000-900,000 tonnes/y of ethylene on the site and currently stores it cryogenically for export. The new plant will save the cost of cryogenic storageiα·ΫΗj of 400,000 tonnes/y of ethylene by replacing it with PE storage and transport. The new plant would start up in 1Q 2006. PE is in deficit in the UK at present.
Petrochemical News 19 JULY 2004
(Vol. 42, No. 29)
Huntsman Mulling Construction Of Wilton, U.K., LDPE Facility
http://www.petrochemical-news.com/P-V42N29.pdf
Huntsman International LLC last
week said it is considering construction of a low-density
polyethylene (LDPE) facility at its Wilton, U.K., site.
Kurt Dowd, vice president of finance and investor relations for
Huntsman, told PCN that Huntsman's board is expected to make a
decision by the end of this year on building a 400,000-t/y LDPE plant at
the Wilton complex.
The company has a large ethylene cracker in Wilton - "one of
the lowest cost facilities in Europe", Dowd explained. We
believe a polyethylene plant in tandem with the cracker makes
good economic sense, he added.
Huntsman acquired
the Wilton cracker from BP and ICI in 1999. At that time, the cracker was reported
to have about 1.9-billion
lbs/yr of ethylene and 880-million lbs/yr of propylene capacity.
2004/9/7 Platts @@@@@@@@\@@@@@@@Oξρ
Huntsman announces go-ahead for
world's largest LDPE plant
Huntsman has finalized its decision to build a 400,000 mt/yr low
density polyethylene plant at Wilton, UK. The GBP200-mil
($355-mil) plant will mark Huntsman's entry into the European
polyethylene market. A Huntsman statement added that the plant
will create 117 permanent jobs and sustain a further 745
positions at the company's aromatics business in North Tees and
Wilton.
The company expects to begin construction in 2005, with the plant
being operational in the third quarter of 2007, subject to
technology licensing. The new plant will consume ethylene made at
Huntsman's cracker at Wilton in the UK. The announcement came as
UK Trade and Industry Secretary, Patricia Hewitt announced a
GBP16.5-mil grant to Huntsman.The new facility is expected to
reduce the UK's need to import LDPE, and help turn the country
into an exporter of product.
Huntsman to Proceed With
Construction of World's Largest Polyethylene Plant
http://www.huntsman.com/index.cfm?PageID=816&News_ID=1239&style=8
Huntsman President and Chief
Executive Officer Peter R. Huntsman today announced the go-ahead
for plans to build the world's largest low density polyethylene
(LDPE) manufacturing facility, on Teesside in the UK. The
announcement was also made simultaneously in London by UK
Secretary of State for Trade and Industry, Patricia Hewitt, MP
The 400,000 tonnes per year plant, Huntsman's first venture into
the growing European polyethylene market, will be built at the
Wilton International site at a cost of around 200 million. The company anticipates the
main plant will cost approximately 180 million with a further 20 million covering logistics and
infrastructure.
It will create 117 permanent jobs and help underpin the future of
the Huntsman Cracker facility at Wilton and will also help to
sustain a further 747 Huntsman and contractor jobs at the
company's Aromatics business at North Tees and Wilton.
Subject to the signing of a technology license agreement, the
company expects to begin construction in 2005, with the plant
being operational in the third quarter of 2007.
Huntsman's decision to move ahead with the new facility is due in
large part to a grant of 16.5
million ($30 million) under the Regional Selective Assistance
(RSA) scheme from the UK Government, via the Department of Trade
and Industry.
Mr. Huntsman commented: "Teesside is one of the most
important of our global locations and we are delighted that we
will now enhance our presence here with this large, world class
polyethylene facility. It is good news for Huntsman, for the
economy of the NorthEast and for the UK as a whole. We have
worked hard to make it a reality and the faith and confidence of
the UK Government has been very important to the process.
"I would like to thank the Right Honourable Patricia Hewitt,
MP, for the support of the UK Government and the Department of
Trade and Industry in helping us to secure this grant, which has
been a crucial factor in turning this project into a reality.
"And I would especially like to pay personal tribute to all
those who have helped in gaining us Government support,
particularly our local MPs, Vera Baird and Ashok Kumar, One
NorthEast, Redcar & Cleveland Council, Tees Valley
Regeneration and our Trades Unions," added Mr Huntsman.
Patricia Hewitt, MP, Secretary of State for Trade and Industry,
said: "It is vitally important to the country that we
maintain a strong manufacturing sector and I'm sure this project
will encourage others that the UK is a great place to invest for
the future.
"This is an important project that will have a major impact
on the chemical industry and the UK economy both locally and
nationally," she added.
Alan Clarke, One NorthEast Chief Executive, said: "This
investment by Huntsman is fantastic news, not just for the Tees
Valley, but for the whole of the North East. The state-of-the-art
new polyethylene plant will create more than 100 new jobs, and
will also safeguard over 700 others in the regional chemical
industry, offering a bright future to so many valuable, skilled
workers."
He added: "The importance of the chemical industry to the
North East cannot be underestimated - our region boasts a world
class chemicals sector, which contributes hugely to regional and
national GDP."
Neil Etherington, Strategic Investment & Marketing Director,
Tees Valley Regeneration, commented: "This really is
terrific news and has been well worth waiting for. This
investment will be the glue that secures the whole of our
petrochemical complex and sends a very strong message to the rest
of the world that we offer a competitive and world class product.
"The significance of this project is enormous and
far-reaching, and in many respects this success reflects both the
faith that Huntsman has in our area - and the faith Tees Valley
Regeneration has in Huntsman," added Mr Etherington.
The total UK market demand for LDPE is currently around 500,000
tonnes per year, with approximately another five million tonnes
used annually in Europe. The new Huntsman facility will
significantly reduce the UK's need to import material to meet its
low-density requirements, and will help turn the country into a
net exporter of the product. It is anticipated that product from
the new plant will be used primarily in packaging applications.
The new plant also will be an important consumer of the ethylene
made at Huntsman's Cracker manufacturing facility at Wilton,
thereby underpinning the future of this key plant for the
foreseeable future.
The combined Huntsman companies constitute the world's largest
privately held chemical company. The operating companies
manufacture basic products for a variety of global industries
including chemicals, plastics, automotive, aviation, footwear,
paints and coatings, construction, technology, agriculture,
health care, textiles, detergent, personal care, furniture,
appliances and packaging.
Originally known for pioneering innovations in packaging, and
later, rapid and integrated growth in petrochemicals,
Huntsman-held companies today have more than 15,000 employees,
operations in 30 countries and annual revenues of approximately
$9.5 billion.
Huntsman Breaks Ground
For New 200 Million Polyethylene Project
At Wilton
http://www.huntsman.com/index.cfm?PageID=5549&News_ID=1411&style=4544
Huntsman Corporation
President and Chief Executive Officer Peter R Huntsman today
(Thursday, 6 October) launched the start of construction of the
world's largest Polyethylene facility at the Wilton International
chemical complex near Redcar.
In a Groundbreaking ceremony performed jointly with Redcar MP
Vera Baird, Mr Huntsman and Ms Baird took control of a mechanical
digger to excavate the first soil at the 35-acre site.
And he heralded the formal start of building as a
"profoundly significant step forward for both Huntsman and
the chemical industry in the North East."
Mr Huntsman told
assembled guests and Company employees that the 200 million Polyethylene project,
which attracted a Government grant of 16.5 million, was vitally
important to the future of Huntsman's operations on Teesside.
"Teesside is one of the most important of our global
locations and we are delighted to enhance our presence here with
this large, world class polyethylene facility, he said. "It
is good news for Huntsman, for the economy of the NorthEast and
for the UK as a whole. We have worked hard to make it a reality
and the faith and confidence of the UK Government has been very
important to the process."
Mr Huntsman thanked
the many people and agencies involved in achieving the go-ahead
for the project. "I would especially like to pay personal
tribute to all those who helped us to gain Government support for
the project, particularly our local MPs, Vera Baird, Ashok Kumar,
Dari Taylor and Frank Cook, One NorthEast, Redcar & Cleveland
Council, Tees Valley Regeneration and the Trades Unions,"
added Mr Huntsman.
Mr Huntsman added: "This new facility will underpin the
continued operation of our major Olefins Cracker facility at
Wilton well into the future, which is strategically very
important to the integrated chemicals infrastructure on
Teesside."
His sentiments were
echoed by Vera Baird, who commented: "It is immensely
important to the country that we maintain a strong manufacturing
sector and I'm sure this project will encourage others that both
the Tees Valley and the UK are great places to invest for the
future.
"This is a very significant project that will have a major
positive impact on the chemical industry and the economy of the
UK both locally and nationally," she added.
Piling and ground preparation work will start on site shortly and
construction of the 400,000 tonnes a year polyethylene
facility will
be spread over two years, with completion due in the fourth
quarter of 2007.
The impact of the new project on jobs - both locally, regionally
and nationally - will be very substantial. When operational, the
new plant will employ some 120 permanent staff and will help
underpin around 750 Huntsman and contractor jobs at the North
Tees and Wilton complexes.
In addition, approximately 700 jobs will be created during the
construction phase of the project. It is estimated this will also
help to generate or underpin a further 1,000 indirect jobs in the
Tees Valley and around 900 indirect jobs nationally.
It is also estimated that the emultiplier'
or eknock-on' effect of between five and 12
local and national jobs being generated by each new permanent job
could create or secure several thousand jobs throughout the UK.
Margaret Fay, Chairman of One NorthEast said: "Today's
ground breaking ceremony is not only the start of a new world
scale polyethylene plant but very much symbolizes the future
aspirations of the process industries in the North East.
"The chemicals and process industry sector is one of this
region's most successful and important in terms of growth,
investment, international trade, skilled workers and research and
development. It is this well-deserved status that has helped
attract such a great number of leading names like Huntsman to the
North East.
"I am delighted that Huntsman is making such an important
commitment to the process industry sector, to the Tees Valley and
indeed to the wider region," she added.
Polyethylene is a plastic widely used in sheet form for the
protection and packaging of everyday articles and foods and is
also used extensively to make bottles and containers. It is
manufactured in a high pressure process, using ethylene which is
the main product of Huntsman's Cracker facility at Wilton. The
product from the Polyethylene plant will be an inert, safe
"chip" transported in bags and bulk.
The plant has been designed using the current best technologies
to both produce LDPE and supply utilities to the plant. These
technologies, along with good management, will help to ensure
that the safety and environmental performance of the new plant
will be exemplary.
Huntsman is a global manufacturer and marketer of differentiated
and commodity chemicals. Its operating companies manufacture
basic products for a variety of global industries including
chemicals, plastics, automotive, aviation, footwear, paints and
coatings, construction, technology, agriculture, health care,
textiles, detergent, personal care, furniture, appliances and
packaging. Originally known for pioneering innovations in
packaging, and later, rapid and integrated growth in
petrochemicals, Huntsman today has 11,300 employees, 57
operations in 22 countries and had 2004 revenues of $11.5
billion.
Platts 2005/11/16
US Huntsman to break
ground for Singapore polyetheramines plant @@|G[eA~
Huntsman of the US
is scheduled to launch construction of a new polyetheramines
plant in Singapore on Nov 30, a company source said Tuesday.
Huntsman to Build
Polyetheramine Manufacturing Facility in Singapore
http://www.huntsman.com/index.cfm?PageID=1159&News_ID=1390&style=40
Peter R. Huntsman,
President and CEO of Huntsman Corporation today announced the
company plans to build a world scale polyetheramine manufacturing
facility in Jurong Island, Singapore.
The company expects the facility, which will have an annual
capacity of approximately 30 million pounds, to be operational in the first
quarter of 2007.
Mr. Huntsman commented, "Our construction of this new
facility is consistent with our corporate strategy of selectively
investing in our differentiated businesses, and will help us to
meet the rapidly growing demand for polyetheramines, especially
in the critical Asia/Pacific region.
"We currently have polyetheramine production facilities in Conroe, Texas and
Llanelli, Wales.
Completion of the Singapore plant will increase our capacity by
approximately 25% and give us a truly global platform for the
manufacture and marketing of this specialty product."
Key polyetheramines
applications include epoxy coatings, concrete additives, organic
pigments, fuel and lube additives, and herbicides and pesticides.
Huntsman is a global manufacturer and marketer of differentiated
and commodity chemicals. Its operating companies manufacture
basic products for a variety of global industries including
chemicals, plastics, automotive, aviation, footwear, paints and
coatings, construction, technology, agriculture, health care,
textiles, detergent, personal care, furniture, appliances and
packaging. Originally known for pioneering innovations in
packaging, and later, rapid and integrated growth in
petrochemicals, Huntsman today has 11,300 employees, 57
operations in 22 countries and had 2004 revenues of $11.5
billion.
British Plastics &
Rubber 2006/2/1
Bidders in talks to buy Huntsman
The giant American chemicals company Huntsman Corporation is in
takeover talks. The company includes in its portfolio the former
ICI Polyurethanes, the former Rohm and Haas TPU, and the former
Vantico (Araldite) epoxy businesses and is currently involved in
major polyurethanes investments in China and the construction of
the world's largest polyethylene facility at Wilton on Teesside.
Reports from the USA have linked Huntsman, which went public last
year but is still owned substantially by its founder Jon
Huntsman, with interest from a number of private equity firms.
Apollo Management, which has just bought Tyco's plastics and
adhesives business, has been tipped as a leading bidder with a
price of in excess of $4E3 billion in discussion.
Huntsman has confirmed that it has 'contacted, obtained proposals
from, and held discussions with, a limited number of potential
acquirers or merger partners' but that there has been no decision
as yet as to whether the company would be sold or remain as an
independent public company.
2006/1/31 Hunsman
Huntsman Confirms Interest in Company
http://www.huntsman.com/index.cfm?PageID=1159&News_ID=1471&style=40
Huntsman Corporation (NYSE: HUN) today announced that in late 2005 it received an indication of interest regarding an acquisition of all of the outstanding stock of the Company.
In response to this indication of interest, the Board of Directors engaged financial and legal advisors to assist it in evaluating a sale of the Company and other alternatives to enhance shareholder value, including continuing to execute its business plan.
Huntsman Ends Discussions
On Company's Sale
http://www.huntsman.com/index.cfm?PageID=5549&News_ID=1473&style=4544
Huntsman Corporation
announced today that it has terminated discussions regarding
existing proposals to acquire the Company.
After careful review of the proposals received, the Company's
prospects and other strategic initiatives available, as well as
thorough discussions with the parties, the Board of Directors of
the Company and its special committee have concluded that none of
the proposals were in the best interests of the shareholders.
Jon M. Huntsman, Founder and Chairman of the Company, said:
"The Company appreciates the thoughtful and diligent review
by the special committee and the Board of Directors throughout
this process, which began with an unsolicited indication of
interest. As a shareholder, I fully support this conclusion.
While the last proposals were above the price of our IPO last
year I believe they were not adequate, particularly in light of
the risks, uncertainties and extended timing of the proposed
transactions.
"Moreover, there are significant opportunities for our
Company going forward.
We believe our historical stock prices have not reflected the
full value of our differentiated businesses. Accordingly, we are
continuing to evaluate the available alternatives for realizing
this potential."
Peter Huntsman,
President and Chief Executive Officer, said: "Like other
companies located on the Gulf Coast, our fourth quarter 2005
results were negatively impacted by Hurricanes Rita and Katrina
and the unprecedented spikes in energy prices leading up to and
during that period. Our largest North American facilities are
located where the eye of Rita came ashore and many of our
operations in the region were suspended for most the quarter. The
Company estimates that Hurricanes Rita and Katrina had a direct
negative impact of approximately $140 million on fourth quarter
EBITDA or approximately $0.60 per share. In addition, the
indirect impact related to these storms was significantly higher
than originally anticipated. However, we do not expect continued
hurricane impact of any significance into 2006."
"We are
enthusiastic about the global opportunities and prospects we see
for 2006 and beyond, including expanding our differentiated
businesses and possible divestitures to accelerate our debt
reduction."
2006/2/24 Texas
Petrochemicals@@@@@@@@@Huntsman\
Texas
Petrochemicals, Inc. Announces Intent to Purchase Assets of
Huntsman Corporation's U.S. Butadiene Business
http://www.txpetrochem.com/ci/pdf/tpcnews/TPC-PurchaseofHuntsmanCorpAssets.pdf
Texas Petrochemicals,
Inc. (the "Company") today announced that Texas
Petrochemicals LP
has signed a letter of intent to purchase the assets of the
United States butadiene and related MTBE operations of Huntsman
Corporation, which includes a manufacturing facility located in
Port Neches, Texas, for a purchase price of $275 million, subject
to customary adjustments. The transaction is expected to close in
mid-2006.
The Port Neches
manufacturing facility has a capacity of approximately 900
million pounds of butadiene per year. The addition of these
assets creates a business with more than $1.7 billion in revenues
on a pro forma basis based on calendar year 2005
results.
"The purchase
of these assets represents an important step for the Company in
its overall long-term growth strategy,"
said Charlie
Shaver, the Company's President and CEO. "These assets, when
combined with our current operations in Houston, will provide
cost synergies that will allow us to better serve our customers
and suppliers while providing continued long-term growth in value
to our shareholders."
Headquartered in
Houston, Texas, Texas Petrochemicals LP is a premier chemical
company with more than $1 billion in annual sales. The Company
provides quality C4 chemical products and services to both local
and global industry companies. The Company has manufacturing
facilities in the industrial corridor adjacent to the Houston
Ship Channel and operates product terminals in Baytown, Texas and
Lake Charles, Louisiana.
2006/2/24 Huntsman
Huntsman To Sell U.S. Butadiene Business
http://www.huntsman.com/index.cfm?PageID=1159&News_ID=1481&style=40
Huntsman Corporation
announced today that the Company has signed a letter of intent to
sell the assets of its U. S. butadiene and MTBE business, which
includes a manufacturing facility located in Port Neches, Texas,
to Texas Petrochemicals, L.P. for a sales price of $275 million,
subject to customary adjustments. The transaction is expected to
close in mid-2006.
Huntsman has owned the business since its 1994 acquisition
of Texaco Chemical Company. The manufacturing facility has a
capacity of approximately 900 million pounds of butadiene
per year and approximately 11,000 barrels per day of MTBE. The business has about 240
employees. The business had 2005 revenues of approximately $626
million and EBITDA of approximately $43 million.
Peter R. Huntsman, President and CEO, commented, "Our sale
of the butadiene business will allow us to focus more of our
attention and resources on our differentiated businesses. We
intend to utilize the proceeds from this sale to reduce debt and
to invest in other parts of the Company, including our recently
announced acquisition of Ciba's Textile Effects business.
"We have owned the butadiene business and site for nearly 12
years, and have enjoyed a good return on our original investment.
Our associates who have worked in and currently run the business
and facility are some of the most talented and dedicated
professionals in the chemical industry. Texas Petrochemical is a
company where butadiene is among its core products. We purchased
a plant in 1994 that was on the verge of closure. This sale to
TPC will ensure a long-term future for this site."
Huntsman's PO/MTBE
and Oxides/Olefins facilities in Port Neches and its facility in
nearby Port Arthur are not included in the sale.
Huntsman is a global manufacturer and marketer of differentiated
and commodity chemicals. Its operating companies manufacture
basic products for a variety of global industries including
chemicals, plastics, automotive, aviation, footwear, paints and
coatings, construction, technology, agriculture, health care,
textiles, detergent, personal care, furniture, appliances and
packaging. Originally known for pioneering innovations in
packaging, and later, rapid and integrated growth in
petrochemicals, Huntsman today has 11,300 employees, 57
operations in 22 countries and had 2005 revenues of $13 billion.
Huntsman, Texas
Petrochemicals Enter Into Definitive Agreement On Butadiene
Business
http://www.huntsman.com/index.cfm?PageID=5549&News_ID=1490&style=4544
Huntsman Corporation
announced today that it has entered into a definitive agreement
to sell the assets comprising its U.S. butadiene and MTBE business to Texas Petrochemicals,
L.P. for a sales price of $269 million, subject to customary
adjustments. The companies expect to close the transaction in
May.
The companies had signed a letter of intent regarding the sale in February.
Peter R Huntsman, President and CEO, stated, "This sale is
in keeping with our strong commitment to enhance shareholder
value, including our strategy to focus more on our differentiated
businesses. We shall use the proceeds from the sale to reduce
debt and to invest in our differentiated portfolio."
Huntsman has owned
the butadiene and MTBE business since its 1994 acquisition of
Texaco Chemical Company. The manufacturing facility in Port
Neches, Texas has a capacity of approximately 900 million pounds
of butadiene per year and approximately 11,000 barrels per day of
MTBE. The business has about 220 employees. It had 2005 revenues
of approximately $645 million and adjusted EBITDA of
approximately $43 million.
Mr. Huntsman said butadiene is a core product for Texas
Petrochemicals, and the sale ensures a long-term future for the
business.
Huntsman's PO/MTBE and Oxides/Olefins facilities in Port Neches,
Texas and its facility in nearby Port Arthur, Texas are not
included in the sale.
Texas Petrochemicals LP @@http://www.txpetrochem.com/ci/ci.htm
Texas Petrochemicals LP
(TPC) specializes in C4 hydrocarbons. The company's integrated
manufacturing facility focuses on production and marketing within
four main business units: C4 Olefins, Specialty Chemicals,
Fuel Products and Polyisobutylene. TPC maintains its leadership in
the industry with an innovative ability to bring high-quality
products to the marketplace. Among the diverse product lines
available to TPC customers are Butadiene, Butene-1, Isobutylene
and Isobutylene derivatives.
Texas
Petrochemicals LP (TPC) became a significant C4 producer with the
acquisition of its Houston C4 chemical processing site in 1984.
In 1996, after 12 successful years of growth and safe operations,
the company's employees, management and a group of investors
acquired the company. Under the new employee ownership, TPC has
moved forward to become the world's best-known processor and
supplier for high-quality C4 chemical products and derivatives.
2006/2/27 Huntsman
Huntsman Selects Geismar as Site for Maleic Anhydride Expansion
http://www.huntsman.com/index.cfm?PageID=5549&News_ID=1482&style=4544
Peter R. Huntsman,
President and CEO of Huntsman Corporation, today announced the
selection of Huntsman's Geismar, Louisiana site as the location
for the Company's previously announced new 100 million pound
world scale maleic anhydride facility. The Company will
commence detailed engineering and reactor procurement
immediately. Huntsman has chosen a fast track implementation
model that will enable the plant to startup in the 3rd quarter of
2008.
Huntsman Vice President, Tom Fisher, commented, "We want to
move as quickly as possible to respond to our customer's growing
requirements and to help ensure the long term supply of maleic
anhydride in North America. The Geismar site was chosen after
evaluating six possible locations. Huntsman has a world scale MDI
manufacturing complex at the site. We are confident that the
Geismar site will provide the most attractive economics for the
plant due to the feedstock availability and the ability to
leverage off existing Huntsman infrastructure currently located
at the Geismar site."
Maleic anhydride is
the building block for unsaturated polyester resins used mainly
in the production of fiberglass reinforced resins for
construction, automotive and marine products. It is also used in
formulations for oil additives, food additives, paper chemicals,
epoxies, as well as other applications. Huntsman is a leading
global producer of maleic anhydride and currently has the annual
capacity to produce 240 million pounds at its
Pensacola, Florida facility. Huntsman also owns a 50% interest in a joint
venture in Moers, Germany that currently
has an annual capacity of 125 million pounds.
Huntsman is a global manufacturer and marketer of differentiated
and commodity chemicals. Its operating companies manufacture
basic products for a variety of global industries including
chemicals, plastics, automotive, aviation, footwear, paints and
coatings, construction, technology, agriculture, health care,
textiles, detergent, personal care, furniture, appliances and
packaging. Originally known for pioneering innovations in
packaging, and later, rapid and integrated growth in
petrochemicals, Huntsman today has 11,300 employees, 57
operations in 22 countries and had 2005 revenues of $13 billion.
* CONDEA-HUNTSMAN is a 50:50 joint venture of RWE-DEA Aktiengesellschaft fur Mineraloel
und Chemie of Hamburg, Germany, and Huntsman Corporation of Salt
Lake City, U.S.A. RWE-DEA conducts its global chemical business
under the CONDEA brand name.
RWE Dea AG
http://www.rwe.com/generator.aspx/rwe-dea/unternehmen/language=en/id=226960/unternehmen.htm
RWE Dea AG is one of the
leading petroleum companies in Germany, with a special focus on
activities relating to the exploration and production of crude
oil and natural gas. This is a field in which RWE Dea enjoys more
than 100 years of experience, cutting-edge drilling and
production technologies, as well as a broad reservoir of
know-how.
In Germany, the company's activities focus on the exploration and
production of natural gas, development of the Mittelplate
offshore field in the North Sea tidelands and the operation of
large underground natural gas storage facilities. Increasingly,
the company's international upstream activities, first and
foremost in Norway and Egypt, as well as in Dubai, Denmark,
Poland and Kazakhstan, are being pursued with growing commitment
in collaboration with competent partners.
RWE occupies top rankings in its core businesses, electricity,
gas, water & wastewater, waste disposal & recycling.
Huntsman Announces Major Pigments Production Increase @@@ FΏ@ρ_»`^@@
Huntsman Corporation
today announced plans for a 50,000 MTE expansion of its flagship
titanium dioxide manufacturing facility at Greatham, U.K.,
bringing the facility's annual capacity to 150,000 MTE.
The expansion will be based upon Huntsman's proprietary ICON
chloride technology and is the second significant project at the
Greatham site since Huntsman acquired the TiO2
business in 1999.
The company expects the new capacity to be operational in the
second half of 2007 and fully completed in early 2008.
Huntsman said the expansion is the first of several major steps
its Pigments business plans to take over the next several months
to further strengthen its global TiO2 market position.
"This capacity increase will position us well to grow with
the titanium dioxide market and to participate more fully in
sectors where our high performing TIOXIDER product portfolio can
create substantial value for our customers,"
said Pigments
Division President, Tom Keenan. "We are extremely optimistic
about our global position in this industry and the plans we have
in place to further strengthen our competitive portfolio by
meeting the growing needs of our customers. We will have
additional announcements in the coming months."
Titanium dioxide is
the most commonly used white pigment that gives consumer products
their brightness and opacity. End-use markets include paints,
plastics, textiles, paper, food and cosmetics.
Huntsman is a global manufacturer and marketer of differentiated
and commodity chemicals. Its operating companies manufacture
products for a variety of global industries including chemicals,
plastics, automotive, aviation, textiles, footwear, paints and
coatings, construction, technology, agriculture, health care,
detergent, personal care, furniture, appliances and packaging.
Originally known for pioneering innovations in packaging, and
later, rapid and integrated growth in petrochemicals, Huntsman
today has 15,000 employees and 78 operations in 24 countries. The
Company had 2005 revenues of $13 billion.
2008/8/24 AsiaPulse via
COMTEX
US chemical giant Huntsman to boost China investment
US chemical giant Huntsman Corp will step up its investment in
China in order to tap into strong domestic demand in the world's
largest market for textile effects chemicals.
Peter Huntsman, the company's president and chief executive
officer, made the remarks at yesterday's inauguration of Huntsman
Textile Effects (China), in Guangzhou, southern China's Guangdong
Province.
The new firm was the result of Huntsman's
acquisition of the global textile effects business of Ciba
Specialty Chemicals Holding Inc for US$253 million, which was
completed last month.
New York-listed Huntsman has so far invested US$1 billion in
China, including the acquisition of Ciba's China-based textile
effects operations.
Huntsman also has a one-third share in a US$1 billion Shanghai chemical
plant that
mainly produces polyurethane. The project, which also has
investment from BASF and Chinese partners, will become
operational today, supplying the shoemaking, automobile and
electrical appliance industries.
The company's sales in China, which grew from zero in 1978 to
US$1 million in 1996, are expected to top US$2 billion this year,
said Huntsman.
He predicted that China's market for textile effects chemicals
will grow by 7 to 10 per cent annually in the coming years and
that Huntsman's sales of those products in the country will
increase twice as fast.
Textile effects chemicals enrich the performance of textile
products, enhancing their colour, reducing creasing and allowing
the fabric to breathe.
Huntsman said he expected China's chemicals market to grow at an
annual rate of 10 to 15 per cent, adding that his firm will
develop its production capacity in China in order to meet this
demand, Huntsman said.
China is the world's largest market for textile effects
chemicals, and Huntsman will expand the capacity of its Guangzhou
plant by 30 to 50 per cent annually over the next two to three
years.
Domestic sales of Huntsman's textile effects products made in
China are set to outstrip its exports in the future, said William
Yau, vice-president of Huntsman Textile Effects Asia Pacific.
Huntsman, which has acquired 35 companies in the past 25 years
and generated revenue of US$13 billion last year, will seek more
opportunities for acquisitions, especially in Asia, Huntsman
said.
2007/2/1 Huntsman
Huntsman and NMG Announce Polyurethanes Joint Venture in Russia
and Former Soviet States
ZAO HUNTSMAN-NMG TARGETS HIGH GROWTH MARKETS
Huntsman Corporation and NMG today announced the creation of a
new, Russia-based joint venture, ZAO Huntsman - NMG, to manufacture and sell polyurethane
systems to
the adhesives, coatings, elastomers and insulation markets in Russia and other
areas in the former Soviet Union. The financial terms were not
disclosed.
"This joint venture marks the latest step in our plan to
build strong positions in rapidly developing markets, a key
component in our global growth strategy"
said Tony Hankins,
President of Huntsman's Polyurethanes division. "This vast
geographic area of 300 million people is enjoying exciting growth
rates and NMG's dynamism, skills and market leadership position
will greatly facilitate our access to some of the more
specialized polyurethanes markets,'' he added.
"This joint venture with Huntsman, one of the world's major
polyurethanes manufacturers with experience and operations across
the globe, will enable NMG to further accelerate its rapid growth
and technology development. NMG and Huntsman have had commercial
links for almost ten years, a guarantee for this venture's smooth
operation in future," said Sergey Ovcharov, CEO and
founder of NMG.
Huntsman NMG will be based at NMG's existing headquarters in
Obninsk, close to Moscow, and will be managed by a General
Director Sergey Ovcharov. The company employs over 200 employees,
and has state of the art manufacturing and distribution
facilities in Obninsk and a network of branch offices across the
region, including in Belarus and the Ukraine.
Huntsman is a global manufacturer and marketer of differentiated
chemicals. Its operating companies manufacture products for a
variety of global industries, including chemicals, plastics,
automotive, aviation, textiles, footwear, paints and coatings,
construction, technology, agriculture, health care, detergent,
personal care, furniture, appliances and packaging. Originally
known for pioneering innovations in packaging and, later, for
rapid and integrated growth in petrochemicals, Huntsman today has
14,000 employees and over 75 operations in 24 countries. The
Company had 2005 revenues of $13 billion.
NMG was founded in 1992 and has grown to be one of the leading
polyurethanes companies in the former Soviet Union supplying a
wide range of industries including construction, footwear and
insulation with specialised polyurethanes systems optimized to
meet specific user needs. Through its far reaching network of
branch offices, NMG aims to provide it's customers with the
highest level of innovation and service.
Huntsman to Sell U.S.
Commodities Business to Flint Hills Resources
Sale Will Complete Final Step in Transformation to Differentiated
Portfolio
Peter R. Huntsman, President and CEO of Huntsman Corporation, today announced that Huntsman has signed definitive documents with Flint Hills Resources, LLC, a wholly owned subsidiary of Koch Industries, Inc., for Flint Hills Resources to acquire Huntsman's U.S. Base Chemicals and Polymers business.
Huntsman is expected to realize a total value from the sale of approximately $761 million. Under the agreement, Flint Hills Resources will acquire the manufacturing assets of Huntsman's U.S. commodities business for $456 million in cash plus the value of inventory ($286 million at Dec. 31, 2006) on the date of closing. Huntsman will retain other elements of working capital, including accounts receivables, accounts payable and certain accrued liabilities (net, $19 million at Dec. 31, 2006), which will be liquidated for cash immediately following the closing.
The transaction includes Huntsman's olefins and polymers manufacturing assets located at five U.S. sites: Port Arthur, Odessa and Longview, Texas; Peru, Illinois; and Marysville, Michigan. The business employs about 900 associates. The captive ethylene unit at the retained Port Neches, Texas, site of Huntsman's Performance Products division is not included in the sale. This asset, along with a long-term post-closing arrangement for the supply of ethylene and propylene from Flint Hills to Huntsman, will continue to provide feedstock for Huntsman's downstream derivative units.
"Upon the closing of the transaction we announced today, Huntsman Corporation will have completed its planned divestitures of its commodity petrochemical businesses and its transformation to a company manufacturing and marketing differentiated products. Our entire product line will now experience higher growth rates and much lower sensitivity to energy costs," said Peter Huntsman. "Looking forward, we have transformed our business into one producing highly innovative products that serve an expanding global economy."
Mr. Huntsman added, "We also are very pleased to be passing the baton to as strong and experienced an operator for these types of assets as is Flint Hills Resources."
"We are excited about this proposed acquisition and its natural extension of our existing capabilities in petrochemical manufacturing and marketing," said Brad Razook, president and chief executive officer of Flint Hills Resources, which is based in Wichita, Kan. "These assets offer us new opportunities for continued growth and diversification, as well as for creating customer value. Once the acquisition concludes, we expect to position these plants for long-term success in the ever-changing global market."
"The assets, skills and capabilities of this operation will complement FHR's existing framework," said Jeff Ramsey, who upon the acquisition's close will manage the business. Ramsey is vice president of chemicals for FHR. "We are acquiring an experienced team, a robust technical service and development capability and a global customer service function that is focused on creating value."
Subject to customary regulatory approvals and other closing conditions, the transaction is expected to close during the third quarter of 2007 following the re-start of Huntsman's Port Arthur, Texas, olefins manufacturing facility.
About Huntsman Corporation:
Huntsman is a global manufacturer and marketer of differentiated chemicals. Its operating companies manufacture products for a variety of global industries, including chemicals, plastics, automotive, aviation, textiles, footwear, paints and coatings, construction, technology, agriculture, health care, detergent, personal care, furniture, appliances and packaging. Originally known for pioneering innovations in packaging and, later, for rapid and integrated growth in petrochemicals, Huntsman today has 14,000 employees and over 75 operations in 24 countries. The Company had 2006 revenues from all operations of over $13 billion.
About Flint Hills Resources:
Flint Hills Resources is a leading producer of fuels, base oils for lubricants, and other petrochemical products, based in Wichita, Kan. It owns refineries in Alaska, Minnesota and Texas, a chemical intermediates plant near Joliet, Ill., pipelines, and an interest in Excel Paralubes in Westlake, La. The company produces pseudocumene at its Corpus Christi, Texas, facility, as well as other building-block chemicals such as metaxylene, orthoxylene, paraxylene, benzene, cumene and toluene. In Illinois, the company produces maleic anhydride, trimellitic anhydride and purified isophthalic acid.
Flint Hills Resources became an independent, wholly owned subsidiary of Koch Industries, Inc., in January, 2002 in order to focus on growth opportunities. This proposed acquisition is a direct result of that business mandate, and adds to assets acquired in 2003 and 2004.
Huntsman Scales Up
Process to Convert a Biodiesel By-product to Propylene Glycol
Company Continues
Sustainable Chemistry Initiative
Huntsman
Corporation today announced a further step in its plan to
commercialize a process for manufacturing propylene glycol
from a renewable raw material, and will make it available for
customer trials as early as next month.
"We expect the
rapid growth in biodiesel production worldwide to create a
surplus of glycerin and, with it, an opportunity,"
said Dave Parkin,
Vice President of Huntsman Performance Intermediates. "We
established our business development unit dedicated to
sustainable chemistry to take advantage of just such an
opportunity ? to find profitable ways to meet market demand for
our products, yet using renewable resources as feedstocks."
The production of biodiesel from
vegetable and seed oils creates the by-product glycerin, which then can be used to
manufacture propylene glycol for the global market's
four-and-a-half billion pound annual demand for the material.
Propylene glycol is used to de-ice commercial aircraft prior to
take-off, and in the manufacture of construction materials, among
other end uses.
Using proprietary
technology developed at the Huntsman Advanced Technology Center,
the company initially will manufacture the bio-based propylene
glycol at its Process Development Facility in Conroe, Texas. This
state-of-the-art facility can turn out products in intermediate
scale quantities, pending further scale up and transfer of the
process to Huntsman's larger scale plants. Huntsman expects its
bio-based propylene glycol to be commercially available by 2008.
"At Huntsman,
we think sustainable chemistry makes good sense, both for our
environment and for our business, and we have the experience and
the expertise to take it from development to commercial
reality," said Parkin. "Bio-based
propylene glycol is just one example of our commitment to
sustainable chemistry. We look forward to future announcements of
other developments from our sustainable chemistry
initiative."
Huntsman is a
global manufacturer and marketer of differentiated chemicals. Its
operating companies manufacture products for a variety of global
industries, including chemicals, plastics, automotive, aviation,
textiles, footwear, paints and coatings, construction,
technology, agriculture, health care, detergent, personal care,
furniture, appliances and packaging. Originally known for
pioneering innovations in packaging and, later, for rapid and
integrated growth in petrochemicals, Huntsman today has 14,000
employees and over 75 operations in 24 countries. The Company had
2006 revenues from all operations of over $13 billion.
Cargill to Lead Commercialization of Renewable Propylene Glycol from Glycerin
Cargill is leading efforts to commercialize a proprietary process for using glycerin -- an abundant, low cost co-product of biodiesel production -- as feedstock for a platform of biobased products, beginning with renewable propylene glycol (PG). Through a new company being formed, the venture will provide commercially competitive PG from renewable feedstocks manufactured in multiple geographies.
The new proprietary process increases production efficiency and lowers manufacturing costs with better yields and fewer byproducts than other renewable and non-renewable routes to propylene glycol production. PG is commonly used in a variety of resins, food ingredients, lubricants, cosmetics, paints, detergents and antifreeze.
"Cargill already sells glycerin from its biodiesel plants and has ready access through its supply chain and other sources to enough glycerin for world-scale production of PG," said Jim Stoppert, senior director of Industrial Bioproducts for Cargill. "We are confident that our approach to manufacturing price-competitive, renewable PG on a large commercial scale will be highly desired by the chemicals industry."
Initial indications are that the new company's PG will not require reformulation prior to downstream use. In addition, Cargill's strong global presence and glycerin supply chain expertise will allow market rollout to occur quickly.
"We anticipate continued, steady growth in the PG market," said Stoppert. "Current capacities remain tight and the fluctuation of propylene prices continues to batter the industry. These market dynamics create a ripe opportunity for a new, renewable and stable product offering."
Cargill is an international provider of food, agricultural and risk management products and services. With 149,000 employees in 63 countries, the company is committed to using its knowledge and experience to collaborate with customers to help them succeed.
Biodiesel Magazine December 2006
Cargill makes plans for glycerin supply
Cargill, an experienced agricultural company but a relatively new biodiesel producer with a 37 MMgy plant in Iowa Falls, Iowa, announced plans to form a new company that will make a variety of bio-based products from glycerin, a by-product of transesterification. The name of the future company wasn't available at press time.
Cargill plans to commercialize a proprietary process that turns glycerin into propylene glycol (C3H8O2), a sweet, colorless, viscous, hygroscopic liquid used as an antifreeze, in brake fluid, and as a humectant in cosmetics and personal care items.
The company's Iowa Falls production facility also includes a 30 million-pounds-per-year glycerin refinery, which started operations in September, according to Glycerin Products Manager Rob Wolter. "Cargill already sells glycerin from its biodiesel plants, and has ready access through its supply chain and other sources to enough glycerin for world-scale production of [propylene glycol]," said Jim Stoppert, senior director of industrial bio-products for Cargill. "We are confident that our approach to manufacturing price-competitive, renewable [propylene glycol] on a large, commercial scale will be highly desired by the chemicals industry."
The Missouri Soybean Association and Cargill announced plans earlier this year for a 40 MMgy biodiesel plant and a 30 million-pound food-grade glycerin refinery adjacent to Cargill's existing soybean processing facility in Kansas City, Mo. The project is jointly owned by Cargill and Paseo Biofuels LLC, an entity comprised of Missouri soybean farmers. A Missouri Soybean Association representative said construction on the project is expected to begin later this month."We anticipate continued, steady growth in the [propylene glycol] market," Stoppert said. "Current capacities remain tight, and the fluctuation of propylene prices continues to batter the industry. These market dynamics create a ripe opportunity for a new, renewable and stable product offering."
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Huntsman Poised to Open
New Polyetheramines Plant in Third Quarter
@@New Plant to Meet Growing Demand
for JEFFAMINE® Product Line
Huntsman Corporation today announced mechanical completion of its first Asia Pacific polyetheramines plant. With this announcement, Huntsman expects to introduce feedstock to the plant in mid-June and be in commercial operation by the third quarter.
Huntsman and its
engineering contractor, Jacobs Engineering, achieved mechanical
completion of the 15,000 tonnes per annum JEFFAMINE®
polyetheramines
plant, after
an 800,000 man-hour construction process, without a single lost
time incident. Huntsman's total investment in the
project, located at Jurong Island,
Singapore,
is approximately US$40 million.
"This is a
major achievement in our effort to meet the growing global demand
for JEFFAMINE® polyetheramines,"
said Don Stanutz,
President of Huntsman's Performance Products division.
"The Singapore
plant, which will complement Huntsman's polyetheramines
facilities in Conroe, Texas, and Llanelli, Wales, will serve as a
key platform as we continue supporting our customers'
global growth,
particularly in the rapidly growing Asia Pacific region,"
said Stanutz.
The new plant will utilize Huntsman's latest proprietary amine technology, to ensure safety and environmental performance in line with Huntsman's global commitment to excellence in environmental, health and safety, as well as compliance with local policies and procedures.
"Already the leading polyetheramines producer in the world, completion of the Singapore plant will further increase Huntsman's capacity and give us a more global and flexible asset base for the manufacture and marketing of these sought after specialty products," continued Stanutz. "With its world class infrastructure, highly skilled workforce, strong intellectual property protection and excellent connectivity, Singapore was an excellent choice for this latest addition to Huntsman's substantial manufacturing presence in the Asia Pacific region."
Key JEFFAMINE® polyetheramine applications include epoxy composites for use in wind blades and other applications, epoxy coatings, concrete additives, organic pigments, fuel and lubricant additives, herbicides and pesticides. The wide range of molecular weights, amine functionality, and oxide type and distribution provide flexibility in synthetic design of compounds made from JEFFAMINE® products. For the most part, JEFFAMINE® products undergo typical amine reactions and are low viscosity, low in color and exhibit low vapor pressure.
Huntsman is a global manufacturer and marketer of differentiated chemicals. Its operating companies manufacture products for a variety of global industries, including chemicals, plastics, automotive, aviation, textiles, footwear, paints and coatings, construction, technology, agriculture, health care, detergent, personal care, furniture, appliances and packaging. Originally known for pioneering innovations in packaging and, later, for rapid and integrated growth in petrochemicals, Huntsman today has 14,000 employees and over 75 operations in 24 countries. The Company had 2006 revenues from all operations of over $13 billion.
Huntsman eyes Clariant,
Ciba takeovers - report
U.S. chemicals group Huntsman Corp. is keen on buying Swiss peers
Clariant and Ciba, the head of Huntsman was quoted as saying,
reinforcing the view either group may be taken over.
"It would certainly be interesting for Huntsman to buy
Clariant, or parts of it," Chief Executive Officer Peter
Huntsman told Swiss newspaper Handelszeitung.
"The same goes for Ciba," said Huntsman, whose group
makes chemicals used in paints and textiles.
Merger speculation has been swirling around Clariant as well as
cross-town rival Ciba, as specialty chemicals companies have been
hard hit by higher raw material costs and increasing competition
from low-cost producers in Asia.
But Huntsman said he would not make a hostile offer.
"First, Clariant or single divisions must officially be for
sale," Huntsman told the newspaper.
A Clariant spokesman said the company had received no takeover
offers, the newspaper said, while a spokesman for Ciba said the
company was well equipped to go it alone.
German chemicals group Lanxess was mentioned last month as a
possible suitor for Clariant, boosting its shares. Lanxess at the
time declined to comment.
Ciba last year sold its Textile Effects unit to Huntsman for some
330 million Swiss francs ($266.1 million).
Huntsman to Acquire Baroda Division of Metrochem Industries
Huntsman Corporation
today announced that its Textiles Effects business has signed an
agreement to acquire the Baroda division of Metrochem Industries
Ltd for $46.5 million in cash. The division to be acquired by
Huntsman is a textile dyes and intermediates
manufacturer based in Baroda, India. The transaction, which is subject
to regulatory approvals, is expected to close in January 2008.
"This
acquisition further strengthens Huntsman's textiles business and
represents another example of Huntsman's ongoing commitment to
further growth of its differentiated product lines," said
Paul Hulme, President of Huntsman's Materials and Effects
division. "After the acquisition of the
Textile Effects business from Ciba in June 2006, we announced a
restructuring plan for the business that includes an investment
plan to optimize our supply chain in Asia, our fastest growing
market. We are very pleased to be able to
announce this acquisition, which is a major milestone in our
growth and geographic strategy."
The Baroda Division of Metrochem, which employs approximately 300 associates, is well-known to Huntsman as a long-term strategic supplier for its Textile Effects business. This acquisition will provide a secure supply of finished products for global markets and intermediates for other Huntsman manufacturing sites globally.
Huntsman is a global manufacturer and marketer of differentiated chemicals. Its operating companies manufacture products for a variety of global industries, including chemicals, plastics, automotive, aviation, textiles, footwear, paints and coatings, construction, technology, agriculture, health care, detergent, personal care, furniture, appliances and packaging. Originally known for pioneering innovations in packaging and, later, for rapid and integrated growth in petrochemicals, Huntsman today has 14,000 employees and over 75 operations in 24 countries. The Company had 2006 revenues from all operations of over $13 billion.
Huntsman Receives Merger Proposal From Hexion For $27.25 per Share in Cash
Huntsman Corporation announced today that it has received from Hexion Specialty Chemicals, Inc. ("Hexion"), an entity owned by an affiliate of Apollo Management, L.P., a proposal (the "Hexion Proposal") to acquire all of the outstanding common stock of Huntsman for $27.25 per share in cash.
The Hexion Proposal is subject to termination of Huntsman's previously announced merger agreement with Basell AF ("Basell") (the "Basell Agreement") and the execution of a definitive merger agreement with Hexion. The Hexion Proposal's terms include that Hexion will have up to 12 months, subject to a 90 day extension in the judgment of the Huntsman Board of Directors under certain circumstances, to close the transaction and that the cash price per share to be paid by Hexion will increase at the rate of 8% per annum (inclusive of any dividends paid) beginning nine months after a definitive merger agreement is executed. The required financing for the Hexion Proposal is fully committed. Furthermore, the proposal does not include a financing condition. The Hexion Proposal also includes a $325 million reverse break-up fee payable by Hexion to the Company in the event the transaction does not close due to the failure to obtain regulatory clearance or requisite financing. The Hexion Proposal provides for a $225 million termination fee payable by Huntsman in the event of certain terminations by Huntsman in connection with the exercise by the Board of Directors or the Transaction Committee thereof of its fiduciary duties.
As announced on June 26, 2007, Huntsman entered into the Basell Agreement, pursuant to which Basell agreed to acquire all of the outstanding common stock of Huntsman for $25.25 per share in cash. The Basell Agreement may be terminated under certain circumstances, including if the Company receives a superior proposal and provides advance notice to Basell. If the Basell Agreement is terminated under these circumstances, Basell will be entitled to a $200 million payment. Hexion has agreed to directly fund $100 million of this payment, subject to reimbursement by Huntsman if the transaction with Hexion were not consummated in certain circumstances.
The Huntsman Board of
Directors, with the unanimous agreement of its Transaction
Committee comprised solely of independent directors, has
concluded that the Hexion Proposal could reasonably be expected
to lead to a superior proposal, as defined in the Basell
Agreement. The Transaction Committee is
continuing to evaluate the terms of the Hexion Proposal and the
Company and its advisors are engaged in discussions with Hexion
regarding their proposal. The Transaction Committee, in
determining whether or not to pursue the Hexion Proposal, will
take into account the views of the principal shareholders of the
Company. These principal shareholders are currently required to
support the Basell Agreement under existing voting agreements
with Basell, unless the Board of Directors or the Transaction
Committee elects to terminate the Basell Agreement in favor of a
superior proposal. Pending the culmination of these
discussions with Hexion and the principal shareholders, neither
Huntsman's Board of Directors nor the Transaction Committee has
changed its recommendation regarding the proposed merger with
Basell. Huntsman cannot give any assurance
that the Hexion Proposal will result in a definitive agreement or
a consummated transaction.
July 6th, 2007 Reuters
Apollo-Huntsman: Will history repeat?
Few media reports following Apollo Managementfs efforts to buy Huntsman have mentioned the history between the two companies, which dates back at least to early last year.
According to sources, the relationship does not carry particularly fond memories. It ended last time with a deal falling apart. And while Huntsman has deemed Apollofs current offer as gsuperior,h theyfre still recommending Basellfs bid to shareholders.
On Jan. 31, 2006, the Wall Street Journal reported that Huntsman was in takeover talks, with Apollo considered a leading candidate. Indeed, bankers later confirmed to Reuters that Apollo was bidding through its company Hexion Specialty Chemicals Inc. for the company. Huntsmanfs stock jumped 11 percent on the news and led the company to confirm the talks.
At the time, private equity firm MattlinPatterson owned about 35 percent of the company and Jon Huntsman and his family owned about 24 percent.
The company did not identify the suitors, but did say it had retained Merrill Lynch and SG Cowen as financial advisers.
The following Sunday, Huntsman said it ended takeover talks, sending its stock down by as much as 12 percent.
Houston-based chemical producer Lyondell Chemical Co. and Access Industriesf Basell NV, the former plastics joint venture of BASF and Royal Dutch/Shell Group, were among the industry suitors, according to sources.
But Apollo put in the highest offer, sources said, an offer just above the $22.95 its shares closed at on Friday. Huntsman wanted more than Apollo bid, the sources said, who added that a weak fourth-quarter outlook and antitrust concerns explained why Apollo didnft want to lift its offer.
The sources also said that there was a lot of ill-will between Apollo and Huntsman after the failed deal.Fast forward to Wednesday, just two hours before the 4th of July began.
Ill-will aside, Apollo offered $6 billion for Huntsman through Hexion again, the company said on Wednesday, a bid 8 percent higher than an offer Huntsman accepted from Dutch chemicals maker Basell on June 26.The bitter ending to Apollofs offer last year obviously didnft keep them away this time, but hard feelings likely linger.
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Hexion confirms to buy Huntsman in 10.6 bln usd deal
Hexion Specialty Chemicals Inc, an Apollo Management LP portfolio company, said it has signed a definitive agreement to buy rival chemical company Huntsman Corp for 28.00 usd per share cash, or 10.6 bln usd, including 4 bln usd debt.
The agreement trumps an earlier deal between Huntsman and Dutch company Basell.
Huntsman directors have unanimously recommended the deal, Hexion said, and urged shareholders to do the same.
Craig Morrison, chairman and CEO of Hexion said: 'Our combined company will be one of the world's largest chemical companies and a leader in our ability to serve customers with an expanded portfolio of specialty materials and a significantly enhanced global presence.'
The agreement also provides that the cash price per share to be paid by Hexion will increase at the rate of 8 pct per annum, including any dividends paid, beginning 270 days from July 12.
Hexion said entities controlled by Matlin Patterson and the Huntsman family, which collectively own about 57 pct of Huntsman, have agreed to vote in favour of the transaction, subject to certain conditions.
Huntsman Agrees to Be Acquired By Hexion for $28.00 Per Share
Terminates Merger Agreement With BasellHuntsman Corporation today announced that it has terminated the merger agreement with Basell AF ("Basell") dated June 26, 2007 (the "Basell Agreement") and has agreed to a definitive merger agreement (the "Hexion Agreement") with Hexion Specialty Chemicals, Inc. ("Hexion"), an Apollo Management, L.P. ("Apollo") portfolio company, pursuant to which Hexion will acquire Huntsman in a transaction with a total value of approximately $10.6 billion, including the assumption of debt (the "Hexion Transaction").
Under the terms of the agreement, Hexion will acquire all of the outstanding common stock of Huntsman for $28.00 per share in cash. The agreement also provides that the cash price per share to be paid by Hexion will increase at the rate of 8% per annum (inclusive of any dividends paid) beginning 270 days from July 12, 2007.
The Hexion Transaction was deemed to be a superior proposal to the Basell Agreement and was unanimously approved by the Board of Directors of Huntsman. Huntsman's Board of Directors approved the agreement for the Hexion Transaction at the recommendation of a Transaction Committee comprised solely of Huntsman independent directors. Hexion's Board of Directors also has approved the agreement.
The transaction is subject to customary closing conditions, including regulatory approval in the U.S. and in Europe, as well as the approval of Huntsman shareholders. Entities controlled by MatlinPatterson and the Huntsman family and a Huntsman charitable trust, who collectively own approximately 57% of Huntsman's common stock, have agreed to vote in favor of the transaction. The transaction is not subject to a financing condition and commitments have been obtained by Hexion for all necessary debt financing from affiliates of Credit Suisse and Deutsche Bank AG. Hexion will have up to 12 months, subject to a 90 day extension by the Huntsman Board of Directors under certain circumstances, to close the transaction.
Huntsman's Board of Directors authorized the delivery of a notice of termination of the Basell Agreement, along with the payment of the $200 million break-up fee required by the Basell Agreement. Hexion funded $100 million of the Basell break-up fee while Huntsman funded the remaining $100 million.
Peter R. Huntsman, President and CEO of Huntsman, said: "This is a very favorable outcome for our shareholders and one that reflects a confidence in our Company of which our associates can be very proud. Hexion is an attractive candidate for a merger with Huntsman. We have complementary businesses and, together, will have an even stronger technology platform from which to serve our customers."
Jon M. Huntsman, Founder and Chairman of Huntsman, added: "I have invested much of my life in Huntsman Corporation and consider it the highest honor to be associated with such exceptional customers and associates. However, the time has come when it is in the best interests of our shareholders to sell the Company. I am pleased with the outcome of our merger negotiations with Apollo, and have every confidence that the combined Hexion and Huntsman teams will be superb stewards of this business for the next era."
Huntsman will file a Form 8-K with the U.S. Securities and Exchange Commission (the "SEC") with further details concerning this transaction, including a copy of the Hexion merger agreement.
Merrill Lynch & Co. and Cowen and Company, LLC acted as financial advisors to Huntsman. Vinson & Elkins L.L.P. and Shearman and Sterling LLP acted as legal advisors to Huntsman.
Hexion Specialty Chemicals, Inc. To Acquire Huntsman Corporation For $28.00 Per Share In Cash
Hexion Specialty Chemicals, Inc., an Apollo Management L.P. portfolio company, announced today the signing of a definitive agreement to acquire Huntsman Corporation in an all-cash transaction valued at approximately $10.6 billion, including the assumption of debt.
Under the terms of the agreement, Huntsman stockholders will receive $28.00 in cash for each outstanding Huntsman share of common stock. The Huntsman Board of Directors, based on the recommendation of a Transaction Committee of independent, non-management directors, has unanimously approved the agreement and has recommended that Huntsman stockholders vote in favor of the agreement. Huntsman has terminated its previous merger agreement with Basell AF.
"This transaction provides Hexion and Huntsman with a great opportunity to create a world-class company with leading-edge products and technologies, a greatly expanded global reach particularly in the high-growth Asia-Pacific region, and an outstanding team of people," said Craig O. Morrison, Chairman and CEO of Hexion. "Our combined company will be one of the world's largest chemical companies and a leader in our ability to serve customers with an expanded portfolio of specialty materials and a significantly enhanced global presence."
Joshua J. Harris, founding partner with Apollo Management L.P., said: "This acquisition will build Hexion into one of the world's largest specialty chemical companies. The combined enterprise will have annual sales of more than $14 billion and more than 21,000 associates and 180 facilities around the world. We are pleased to welcome the Huntsman team and look forward to building on their many accomplishments in the industry."
The agreement also provides that the cash price per share to be paid by Hexion will increase at the rate of 8% per annum (inclusive of any dividends paid) beginning 270 days from July 12, 2007. The transaction is subject to regulatory approvals and the affirmative vote of Huntsman's shareholders, as well as other customary conditions. Entities controlled by MatlinPatterson and the Huntsman family, which collectively own approximately 57% of Huntsman's common stock, have agreed to vote in favor of the transaction, subject to certain conditions. The transaction is fully financed pursuant to commitments from affiliates of Credit Suisse and Deutsche Bank.
O'Melveny & Myers LLP and Wachtell, Lipton, Rosen & Katz served as Hexion's legal counsel.
Platts 2007/7/19
Huntsman says enters alliance for Texas biodiesel plant
Huntsman said Thursday it entered an agreement with RBF Port
Neches for the construction of a biodiesel plant to be located at
an existing Huntsman facility in Port Neches, Texas.
Under the agreement, RBF will design, finance, build and own the
new plant, which is to have an initial capacity of 89 million
gal/year of biodiesel, with plans to expand to nearly 180 million
gal/year of production, Huntsman said in a statement. The
chemical giant would operate and maintain the plant, which is
expected to come online in mid-2008. RBF would then be
responsible for the marketing of the output of the plant.
Huntsman has also the option to purchase crude glycerin that
would be a byproduct from the biodiesel plant. The option is
"an important step in Huntsman's recently announced plan to
commercialize its propriety process for manufacturing propylene
glycol from glycerin," the company said.
Affiliates of MatlinPatterson will hold a "significant
portion" of the equity interest in RBF, the statement said.
Huntsman Acquires Global Fluorochemical Product Line for Nonwovens from DuPont
Huntsman Corporation today announced that its Textiles Effects business has signed an agreement to acquire DuPont's global fluorochemical business for the nonwovens industry. The DuPont(TM) Zonyl(R) fluorochemical product line is used on nonwovens as effective repellents for water, alcohol and oil based fluids. Nonwoven textiles are primarily used in medical, filtration, automotive and construction applications.
Following a brief transition period to ensure a smooth handover and uninterrupted supply, Huntsman will assume responsibility for all future activities related to the business. The transaction with DuPont includes a long-term supply agreement for finished products and intermediates, but does not include the transfer of DuPont employees or the sale of DuPont manufacturing assets. The parties also entered into a joint development agreement to bring new innovations to the nonwovens marketplace.
"We are delighted with this transaction, as we believe that DuPont's technology and product stewardship, with its focus on sustainability, will significantly enhance our product offering in the technical textile market, which is strategically important for our Textile Effects business," said Paul Hulme, President of Huntsman's Materials and Effects division. "The addition of this product line will further strengthen our ability to provide innovative products and complementary effects in the nonwovens segment."
Financial details of the transaction were not disclosed.
Huntsman is a global manufacturer and marketer of differentiated chemicals. Its operating companies manufacture products for a variety of global industries, including chemicals, plastics, automotive, aviation, textiles, footwear, paints and coatings, construction, technology, agriculture, health care, detergent, personal care, furniture, appliances and packaging. Originally known for pioneering innovations in packaging and, later, for rapid and integrated growth in petrochemicals, Huntsman today has 14,000 employees and over 75 operations in 24 countries. The Company had 2006 revenues from all operations of over $13 billion.
DuPont is a science-based products and services company. Founded in 1802, DuPont puts science to work by creating sustainable solutions essential to a better, safer, healthier life for people everywhere. Operating in more than 70 countries, DuPont offers a wide range of innovative products and services for markets including agriculture and food; building and construction; communications; and transportation.
Platts 2007/7/27
Texas
Petrochemicals leaving MTBE market by year's end: source
Texas
Petrochemicals (TPC) will step out of the merchant MTBE market by
the end of this year, a source familiar with the operations told
Platts Friday.
TPC
is one of the largest producers of MTBE in the US.
According
to the most recent MTBE production data from the Energy
Information Administration, the US in April produced 62,000 b/d
of MTBE in merchant plants and 4,000 b/d in "captive"
plants, or in-house operations.
TPC
does not disclose its MTBE production, but sources estimate that
it produces 20,000 b/d.
MTBE
has been banned in several states following the discovery of
contaminated groundwater. The US primarily exports to South
America, the Caribbean and Europe, and to a lesser extent, Asia.
The largest MTBE consumers are Mexico, Venezuela, France and the
Netherlands.
TPC
has locations in Houston, Port Neches, and Baytown, Texas. In
addition to MTBE, the company produces butadiene, butene-1
raffinate, isobutylene, diisobutylene, polyisobutylene, nonene,
and propylenetetramer, as well as polymer gasoline and propane.
Huntsm an And Flint Hills
Resources Close On Sale Of U.S. Polymers Business
Sale of Port Arthur Base Chemicals Business to Close upon Plant
Restart
Peter R. Huntsman, President and CEO of Huntsman Corporation,
today announced that Huntsman and Flint Hills Resources, LP, an
independent, wholly owned subsidiary of Koch Industries,
Inc., have
closed on the sale of Huntsmanfs U.S. Polymers business. The parties will close on the
sale of Huntsmanfs remaining U.S. Base Chemicals
business
upon the restart of Huntsmanfs Port Arthur, Texas, olefins
manufacturing facility, commissioning of which is expected to
occur later this year.
Huntsman received approximately $350 million at the closing,
including the estimated value of associated inventory for its
U.S. Polymers business, which remains subject to a post-closing
adjustment. Huntsman will retain other elements of working
capital, including accounts receivables, accounts payable and
certain accrued liabilities, which will be liquidated for cash.
Included in the closing announced today are Huntsmanfs manufacturing assets located at
four U.S. sites: Odessa and Longview, Texas; Peru, Illinois; and
Marysville, Michigan. Huntsmanfs amorphous polyalphaolefin (or
APAO) products, which Flint Hills will manufacture for Huntsman
at the Odessa site under a long-term supply arrangement, are not
included in the sale.
gWe
are delighted to have closed on the sale of our U.S. Polymers
business and look forward to completing this strategic
divestiture by closing on the sale of our U.S. Base Chemicals
business later this year,h said Peter Huntsman. gThe associates that have
transferred to FHR today are among the finest in our industry,
and we are pleased they have joined another world class operator
of chemical assets.h
"Today's
acquisition is an important step for Flint Hills Resources as we
seek opportunities to leverage our capabilities," said Brad
Razook, president and chief executive officer of Kansas-based
Flint Hills Resources, LP. "With the addition of these
polymer production assets and the talented, experienced
workforce, we believe we are positioned to create superior value
for our customers and continue growing."
About Flint Hills Resources:
Flint Hills Resources, LP is a leading producer of fuels, base
oils for lubricants, and other petrochemical products, based in
Wichita, Kan. It owns refineries in Alaska, Minnesota and Texas,
a chemical intermediates plant near Joliet, Ill., pipelines, and
an interest in Excel Paralubes in Westlake, La. The company
produces pseudocumene at its Corpus Christi, Texas, facility, as
well as other building-block chemicals such as metaxylene,
orthoxylene, paraxylene, benzene, cumene and toluene. In
Illinois, the company produces maleic anhydride, trimellitic
anhydride and purified isophthalic acid.
Flint Hills Resources became an independent, wholly owned
subsidiary of Koch Industries, Inc., in January, 2002 in order to
focus on growth opportunities. This acquisition is a direct
result of that business mandate, and adds to assets acquired in
2003 and 2004.
Huntsman and Flint Hills
Resources Close On Sale of Base Chemicals Business
Sale Completed Upon Port Arthur Plant Restart
Peter R. Huntsman, President and CEO of Huntsman Corporation (NYSE: HUN), today announced that Huntsman and Flint Hills Resources, LP, an independent, wholly owned subsidiary of Koch Industries, Inc., have closed on the sale of Huntsmanfs Base Chemicals business.
The sale of the Base Chemicals business is the second closing in a two-part transaction valued in total at approximately $770 million. The parties had previously closed on the sale of Huntsmanfs U.S. Polymers business in August.
Huntsman received approximately $415 million at the second closing, including the estimated value of associated inventory for its Base Chemicals business, which remains subject to a post-closing adjustment. Huntsman will retain other elements of working capital, including accounts receivables, accounts payable and certain accrued liabilities, which will be liquidated for cash. Huntsman had already received approximately $355 million in connection with the partiesf earlier closing for the U.S. Polymers business, which also remains subject to a post-closing adjustment.
Pursuant to the agreement between Huntsman and Flint Hills Resources, the second closing occurred upon the successful restart of Huntsmanfs Port Arthur, Texas, olefins manufacturing facility.
The Base Chemicals business transferred to Flint Hills Resources does not include the captive ethylene unit at the retained Port Neches, Texas, facility which, along with a long-term post-closing arrangement for the supply of ethylene and propylene from Flint Hills to Huntsman, will continue to provide feedstock for Huntsman's downstream derivative units.
gWe are very pleased to have successfully completed the repairs to the Port Arthur facility and to have closed on the sale of our Base Chemicals business,h said Peter Huntsman. gWhile we will miss our colleagues that have now transferred to FHR, we are gratified by the new opportunities they will have as a part of the Flint Hills organization.h
gWith today's close, Flint Hills Resources is focused on creating value for a new group of global customers," said Brad Razook, President and Chief Executive Officer of Flint Hills Resources. gWe are excited about our growing petrochemicals interests and our opportunities to apply our manufacturing and marketing capabilities to this new segment of our business.h
About Huntsman:
Huntsman is a global manufacturer and marketer of differentiated chemicals. Its operating companies manufacture products for a variety of global industries, including chemicals, plastics, automotive, aviation, textiles, footwear, paints and coatings, construction, technology, agriculture, health care, detergent, personal care, furniture, appliances and packaging. Originally known for pioneering innovations in packaging and, later, for rapid and integrated growth in petrochemicals, Huntsman today has 13,000 employees and operates from multiple locations worldwide. The Company had 2006 revenues of over $13 billion. For more information about Huntsman, please visit the companyfs website at www.huntsman.com.
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2008/2/25 Huntsman
Huntsman Commences Design and Feasibility Studies to Expand its
Global MDI Manufacturing Capacity
2008/1/25
Hexion and Huntsman agree to FTC request to extend review time for proposed merger to May 3, 2008.
Huntsman Corporation
announced today that it has commenced design and feasibility
studies to increase its global capacity for the manufacture of
methylene diphenyl diisocyanate (MDI) through investment in a
new, world scale MDI plant at its site in Rozenburg, the
Netherlands.
Feasibility studies, including preliminary engineering for the
new unit, are now underway and a final investment decision is
expected during 2008, with the new 400,000 metric
tons capacity
unit coming on-stream by mid-2011. The final plan may also
incorporate the closure of older, less efficient capacity in
Europe.
Pursuant to the studies, Huntsman also intends to expand its MDI
and downstream asset capacity in all three major regions through
the deployment of new proprietary technologies in aniline,
methylene dianiline (MDA) and MDI production, which will both
increase raw material yields and improve energy efficiency by up
to 40%, as compared with previous generation technology.
Huntsman announced in early 2006 that it was evaluating the
construction of a second MDI unit in China, with its partners
from the existing 240,000 metric tons capacity joint venture MDI
plant in Caojing, Shanghai. Studies for this new plant continue,
with a number of different locations being considered.
"These investments are required to satisfy the sustained
demand growth that we're seeing across a wide range of MDI based
applications , said Polyurethanes Division President, Tony
Hankins. We anticipate that during the next decade the global MDI
market will continue to grow well ahead of global GDP, at around
7-8 % per year - and in Asia well above 10%. We are determined to
maintain our leading position in MDI, and to ensure that we can
continue to support our global customers as their markets
grow."
About Huntsman:
Huntsman is a global manufacturer and marketer of differentiated
chemicals. Its operating companies manufacture products for a
variety of global industries, including chemicals, plastics,
automotive, aviation, textiles, footwear, paints and coatings,
construction, technology, agriculture, health care, detergent,
personal care, furniture, appliances and packaging. Originally
known for pioneering innovations in packaging and, later, for
rapid and integrated growth in petrochemicals, Huntsman today has
13,000 employees and operates from multiple locations worldwide.
The Company had 2007 revenues of approximately $10 billion. For
more information about Huntsman, please visit the company's
website at www.huntsman.com.
Huntsman Joint Venture To Pursue Major Maleic Anhydride Expansion In Germany
Sasol-Huntsman GmbH & Co. KG, a 50/50 joint venture between affiliates of Huntsman Corporation and Sasol Limited located in Moers, Germany, today announced plans to pursue the expansion of its maleic anhydride manufacturing capacity by 45,000 mt. The new capacity, which is expected to be on-line in first quarter 2011, will increase Sasol-HuntsmanLs production capacity by 75%, to 105,000 mt. The expansion will be funded by the joint venturefs internal cash flow and its non-recourse financing.
The expansion will be achieved via construction of a second world scale 45 kt reactor and purification section on the same site as the existing plant. However, the new reactor and purification section will be operated independently from the existing plant to ensure continuous product flow without production interruption, even during scheduled T & I shutdowns and catalyst re-packs.
Basic engineering and site preparation are complete. The reactor and selected other major equipment are scheduled to be ordered in early May, and the EPCM contract to be awarded in June.
The expanded plant will make use of the infrastructure on the Sasol Solvents Moers site, providing synergies for the Sasol-Huntsman joint venture as well as for Sasol.
The new plantfs design is similar to Huntsmanfs 45 kt plant under construction in Geismar (USA), which is expected to be operational in late 2008.
Sasol-Huntsman Managing Director, Rolf Giessel, commented, gThe robust demand for maleic anhydride makes it incumbent upon us to lead the way in meeting our global customersL long-term requirements. Furthermore, this investment will help to maintain our leading position in Europe.g
Maleic Anhydride is the building block for unsaturated polyester resins, used mainly in fibreglass reinforced resins for construction, automotive and marine products. It is also used in formulations for lube oil additives, food additives, paper chemicals, epoxies, as well as in a variety of other applications.
Hexion files suit
alleging that transaction with Huntsman is no longer viable
Combined Company Determined to be Insolvent
Hexion Specialty Chemicals, Inc. (gHexionh) announced today that it and
related entities have filed suit in the Delaware Court of
Chancery to declare its contractual rights with respect to its
$10.6 billion merger agreement with Huntsman Corporation (gHuntsmanh). Hexion said in the suit that it
believes that the capital structure agreed to by Huntsman and
Hexion for the combined company is no longer viable because of
Huntsmanfs increased net debt
and its lower than expected earnings. While both companies
individually are solvent, Hexion believes that consummating the
merger on the basis of the capital structure agreed to with
Huntsman would render the combined company insolvent.
The suit alleges that in light of this conclusion, Hexion does
not believe that the banks will provide the debt financing for
the merger contemplated by their commitment letters. Hexion
stated in its suit that, while it will continue to use its
reasonable best efforts to close the transaction, which includes
obtaining all necessary antitrust and regulatory approvals as
required by the merger agreement, it does not believe that
alternate financing will be available.
Hexion disclosed in the filing that its Board of Directors has
received an opinion from Duff & Phelps, LLC, a leading
provider of independent financial advisory and investment banking
services, concluding that, based on the capital structure agreed
to by the parties at the time the merger agreement was signed,
the combined company would be insolvent based on the fact that it
would not meet the standard tests of solvency and capital
adequacy set forth in the opinion.
The suit also alleges that in light of the substantial
deterioration in Huntsmanfs financial performance, the
increase in its net debt and the expectation that the material
downturn in Huntsmanfs business will continue for a
significant period of time, Huntsman has suffered a material
adverse effect as defined in the merger agreement.
gWhile
both Hexion and Huntsman can be successful as separate companies,
they cannot now support the debt load that was agreed to at the
time the transaction was put together,h
said Craig O.
Morrison, Hexionfs Chairman, President and CEO. gWe continue to have enormous
respect for Huntsman, the Huntsman family and management team and
still believe that a combination of the two companies would offer
significant strategic benefits. However, the financing for the
acquisition is predicated on a certain level of financial
performance and, given the increase in Huntsmanfs total debt and decrease in
earnings, Hexion does not believe that the transaction can be
completed.h
Mr. Morrison
continued: gWhile this development is
disappointing, Hexion ? with its long-dated, stable capital
structure, no significant debt maturities until 2013, and with
more than $475million in liquidity -- remains very well
positioned to service our customers, compete and grow globally.h
About Hexion
Specialty Chemicals
Based in Columbus, Ohio, Hexion Specialty Chemicals serves the
global wood and industrial markets through a broad range of
thermoset technologies, specialty products and technical support
for customers in a diverse range of applications and industries.
Hexion Specialty Chemicals is controlled by an affiliate of
Apollo Management, L.P. Additional information is available at www.hexion.com.
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@
June 19, 2008 The Deal
Hexion Sues to Break Huntsman Deal
Hexion Specialty Chemicals Inc. has sued to get out of its $10.6 billion deal to buy Huntsman Corp. claiming the merged company would be insolvent.
When Hexion, which is owned by Apollo Management LP, disclosed the suit after the market closed Wednesday, it confirmed long-running suspicions the deal might fall apart. Huntsman shares had been trading at more than a $7 spread to the $28 per share bid. The deal had an April termination date that was extended to July 4. It could be extended further, to October under some circumstances.
Huntsman shares closed down 2.8 percent at $20.86 Wednesday in New York and then plummeted an additional 35 percent to $13.50 in after-hours trading.
The jettisoned target Thursday reacted angrily to the development, with president and CEO Peter Huntsman calling it "a blatant attempt to deprive our shareholders of the benefits of the Merger Agreement that was agreed to nearly a year ago."
"Huntsman intends to vigorously enforce all of its rights under the Merger Agreement and seek to consummate the merger on the agreed terms," the company added in the statement.
Peter Huntsman is a member of the founding family, which control the group alongside distressed investment firm MatlinPatterson Global Opportunities Partners LP. The two parties together held 57 percent of the stock when the deal was struck.
In its Wednesday suit in Delaware Chancery Court, Hexion cited Huntsman's increased net debt and lower-than-expected earnings. It said that while both companies are individually solvent, the capital structure contemplated in the merger would leave the combined entity insolvent, making lenders for the deal unlikely to fund it. Hexion seeks a ruling that it is not liable for any damages or breakup fee because there was a material adverse change at Huntsman.
The deal would be financed by Credit Suisse Group and Deutsche Bank AG.
Spokesmen for the parties and the banks could not be reached by press time Wednesday. An Apollo spokesman declined to comment.
Hexion is represented by Peter Hein and Marc Wolinsky of Wachtell, Lipton, Rosen & Katz in the litigation, with Donald Wolfe Jr. of Potter Anderson & Corroon as Delaware counsel.
Hexion said in its statement that it will continue to make reasonable best efforts to close the takeover but that it does not believe that alternate financing will be available.
The merger agreement gives Huntsman the right to bring a specific performance suit against Hexion to compel it to sue the banks should the banks resist funding the deal. Any award would have to be turned over to Huntsman.
The agreement provides for a $325 million breakup fee in some circumstances. The agreement was considered by risk arbitrageurs to be tighter than many other merger contracts.
Huntsman had a disappointing first quarter, with net income dropping to $7.3 million versus $46.6 million in the same period in 2007. Ebitda fell to $169.5 million from $242 million.
Long-term debt, meanwhile, rose 13 percent from $1.975 billion on Dec. 31 to $2.265 billion by March 31.
Hexion's deal, last revised on July 12, 2007, just as the credit markets were beginning to crack, trumped an offer from Basell Holdings BV to which Huntsman had agreed.
Hexion said that Duff & Phelps LLC has advised it that the combined company would not meet the standard tests of solvency and capital adequacy.
A similar insolvency issue surfaced last year in the $1.5 billion proposed merger of footwear retailers Genesco Inc. and Finish Line Inc. Finish Line's lender, UBS Securities LLC, contended that the combined business would be insolvent. Finish Line and UBS ultimately agreed to pay $175 million in a settlement this March, with UBS apparently footing most of the tab.
The suit comes a little more than a year after another Apollo company, logistics firm Ceva Group plc, went to court to force a deal. In that case, it sued EGL Inc., saying EGL had unfairly favored a rival deal. EGL ultimately settled and was absorbed by Ceva.
Huntsman Sues Apollo and Its Top Executives Over Hexion Deal
The gloves are off in the Huntsman-Hexion Specialty Chemicals dispute.
In an expected move, Huntsman on Monday sued its now-reluctant acquirerfs parent, Apollo Management, and two of the private equity firmfs founders, accusing them of tortiously interfering in the $10.6 billion merger of the two chemical makers. The lawsuit, filed in Texas state court, is the latest salvo in one of the few deals remaining from the buyout boom of last year.
Huntsman is claiming that in besting a rival offer from Basell, an industrial conglomerate, Apollo made a promise it did not intend to keep. The Texas-based chemical maker argued that the private equity firm is seeking to renegotiate a lower price.
In its complaint, Huntsman said that it is seeking $3 billion in damages and $100 million to cover its breakup fee payable to Basell. Huntsman is also seeking unspecified damages related to its business and its value.
Hexion and Apollo said in a lawsuit last week that Huntsmanfs lower profits and increased debt would plunge the combined company into insolvency. The banks that had agreed to finance the deal, Deutsche Bank and Credit Suisse, would be unlikely to lend money to complete the deal under those circumstances.
Huntsman, however, argued that both banks are ready to live up to their financing commitments. But Apollo and Hexion published the valuation opinion by Duff and Phelps arguing that the combined Huntsman-Hexion would be insolvent without Huntsmanfs consent. The goal, according to the lawsuit, was to push for a renegotiated lower price.
gAs we alleged in our suit, primarily due to Huntsmanfs underperformance, we believe that consummating the merger on the basis of the capital structure agreed to with Huntsman would render the combined company insolvent,h Hexion said in a statement. gIn fact, Huntsmanfs suit does not dispute that the combined company would be insolvent. We believe Huntsmanfs lawsuit is wholly without merit.h
Interestingly, Huntsman sued not just Apollo, but two founders, Leon Black and Josh Harris. According to its complaint, the company said it is holding both men personally liable for Apollofs actions.
Jon M. Huntsman, the companyfs founder and chairman, said in a statement: gI am outraged that Apollofs founders, Leon Black and Josh Harris, while personally and repeatedly assuring our board of directors, our senior officers, our financial advisors and me of their earnestness, instead pursued a strategy designed to cause us to terminate with Basell to accept promises they never intended to keep.h
2008/8/29 Huntsman
Huntsman Shareholders Offer Capital On Merger Closing
Huntsman Corporation
announced that it received notice of an independent shareholder
initiative to invest at least $500 million in
Hexion on the closing of the merger between Hexion and Huntsman
Corporation. The Huntsman family has indicated
its expectation to join the shareholder initiative by providing a
portion of the $500 million.
As previously
stated, Huntsmanfs shareholders are entitled to
their $28 per share and 8% ticking fee.
We are gratified by
the confidence in the merged company expressed in this
shareholder initiative. However, Huntsman management
firmly believes that the combination of Hexion and Huntsman
Corporation will be solvent.
A trial on whether Hexion can abandon its proposed acquisition is scheduled to begin in Delaware Sept. 8.
In an effort seemingly aimed at prodding Hexion to drop its objection to completing the merger before the trial begins, Huntsman investors that included Citadel Investment Group, D.E. Shaw & Co., Matlin Patterson Global Advisors and Pentwater Growth Capital Management proposed loaning the Ohio-based chemical maker at least $500 million to help it finance the acquisition.
And if some conditions are met, the loan wouldn't have to be repaid.
"This financing serves the dual purpose of enhancing what we believe is your already reasonable rate of return and facilitating a mutually beneficial resolution of the current disagreement between you and Huntsman," the investors wrote in a proposal letter filed Thursday with the U.S. Securities and Exchange Commission.
Those investors indicated they would commit $245 million and that the Huntsman family was expected to commit $186 million. Another $69 million would come from other large stockholders, according to the proposal.nyt 2008/8/28
In a letter sent to Hexion and Apollo on Thursday, the shareholders - including Citadel Investment Management and D. E. Shaw - offered to provide additional financing to help persuade Apollo to close the deal.
The plan involves the use of contingent value rights, financial instruments that would guarantee repayment only if a combined Huntsman-Hexion met certain financial performance targets. If the new company failed to meet those expectations, the investor group would not be repaid.
Though the investorsf said that they are making the offer independently of Huntsman, the group said that trusts for the eponymous Huntsman family have agreed to contribute about $186 million of the proposed financing.
Driving the investorsf proposal is the severe slide in Huntsmanfs stock price since June, when the deal began to founder. Huntsmanfs shares have fallen more than 41 percent over the last three months, closing Thursday at $13.10.
Other members of the investor group include the private equity firm MatlinPatterson, which helped prod Huntsman to sell itself last year, and the hedge fund Pentwater Capital.
In a statement issued late Thursday, Hexion said that it is interested only in terminating the deal.
gWhile we appreciate the efforts of these shareholders, due to the dramatic increase in Huntsmanfs net debt and decrease in its earnings since last July, their proposal does not come close to making the combined company solvent,h the company said. gWe are not seeking to renegotiate this transaction.h
Go to Letter Filed with the Securities and Exchange Commission »
2008/8/28 Hexion
Hexion comments on proposal by Huntsman shareholders
Hexion Specialty
Chemicals, Inc. today issued the following statement in response
to a Report on Schedule 13D filed by several shareholders of
Huntsman Corporation with the Securities and Exchange Commission,
in which they propose an alternative transaction for the
combination of Hexion and Huntsman.
gWhile
we appreciate the efforts of these shareholders, due to the
dramatic increase in Huntsmanfs net debt and decrease in its
earnings since last July, their proposal does not come close to
making the combined company solvent. Huntsmanfs shareholders lack this
information because Huntsman has, despite our repeated requests
for more than two months, refused to permit its shareholders to
review our Delaware complaint and the Duff & Phelps solvency
analysis. If this information were made public, Huntsman
shareholders would understand that this proposal is inadequate.
Furthermore, the proposal is for incremental, not alternative
debt financing, as specified under the merger agreement.
We are not seeking to renegotiate this transaction. We are
seeking to terminate it, and obtain judicial confirmation that
Hexion has no obligation to pursue the acquisition or to pay
Huntsman a termination fee.h
@
August 29, 2008 Wall Street Journal
Hedge Funds Step in to Help the Hexion-Huntsman Deal
If you want something done, do it yourself. Prominent hedge funds are following that mantra and jumping into troubled buyouts to end squabbles that could kill the deals.
Hedge fund D.E. Shaw and three other funds today decided to offer a $500 million incentive to spitting enemies Hexion Specialty Chemicals and Huntsman to convince them to consummate their $6 billion merger. D.E. Shaw is a shareholder in Huntsman and if the deal doesn't go through, the hedge fund stands to miss out on a sizeable profit on its investment. Nor is D.E. Shaw the first to jump in the middle of a buyout fray. Highfields Capital Management helped break a logjam at the buyout of Clear Channel Communications, offering concessions that resulted in revised terms that got the $18 billion deal done. Without Highfields involvement, the Clear Channel deal wouldn't have gotten done.
Hexion and Huntsman, you will remember, have clashed over an acquisition agreement reached before the credit crunch hit last summer. Several months ago, Hexion, owned by Apollo Management, said it wouldn't go through with the deal because the resulting company would be so financially weak as to border on insolvency.
Enter hedge funds D.E. Shaw, MatlinPatterson, Citadel and Pentwater. D.E. Shaw, which owns 21.7 million Huntsman shares, has been worried about the death of the deal. Citadel owns 18.6 million shares and Pentwater owns 1.9 million, according to the most recent filings. So today, the hedge funds, led by D.E. Shaw, offered to provide $500 million to Hexion via a subscription to something called "contingent value rights, or CVRs smθΏzσΜ . Holdings of these get the right to a portion of earnings from a combined Hexion-Huntsman. If the combined company doesn't post a profit-as Apollo has maintained it will not-Apollo gets to keep the money to defray the cost of financing.
Here is how D.E. Shaw explained its offer in a letter today to Hexion:
If Hexion equity holders do not earn the hurdle rate of return, the CVRs expire without payment and become, in essence, a purchase price reduction. The CVRs are repaid only if the rate of return on Hexion equity outperforms the hurdle rate; a result that we believe is likely enough to warrant our investment. From Hexion's perspective, the financing provided in exchange for the CVRs can be used to supplement debt financing for the merger consideration and post-merger liquidity. The result will mean less debt service costs and a higher rate of return on equity.
The offer echoes Highfields Capital Management's move in the Clear Channel deal, when the hedge fund agreed to underwrite $400 million of the $1.1 billion shortfall that could have occurred if Clear Channel investors chose to receive only cash for their shares.
D.E. Shaw's offer backs Apollo into a corner: if the private-equity firm rejects the offer, it will look the Delaware court hearing the case as if Apollo and Hexion oppose a deal under any circumstances. Now, will D.E. Shaw's offer will carry as much weight as Highfields's did with in May.
But Hexion Friday morning didn't sound impressed. In a statement, it said: "While we appreciate the efforts of these shareholders, due to the dramatic increase in Huntsman's net debt and decrease in its earnings since last July, their proposal does not come close to making the combined company solvent. Huntsman's shareholders lack this information because Huntsman has, despite our repeated requests for more than two months, refused to permit its shareholders to review our Delaware complaint and the Duff & Phelps solvency analysis. If this information were made public, Huntsman shareholders would understand that this proposal is inadequate. Furthermore, the proposal is for incremental, not alternative debt financing, as specified under the merger agreement. We are not seeking to renegotiate this transaction. We are seeking to terminate it, and obtain judicial confirmation that Hexion has no obligation to pursue the acquisition or to pay Huntsman a termination fee."
Letter
August 28, 2008
The undersigned institutional investors are stockholders of Huntsman Corporation (gHuntsmanh), or affiliates of such stockholders, interested in facilitating the consummation of the acquisition of Huntsman by Hexion Specialty Chemicals Inc. (gHexionh) pursuant to the Agreement and Plan of Merger, dated July 12, 2007 (the gMerger Agreementh), among Hexion, Huntsman and Nimbus Merger Sub Inc.
We do not wish to comment on the details of your dispute with Huntsman other than to state our own working assumptions, based on publicly-available information, that Hexion can close the transaction on the current terms of the Merger Agreement. From our perspective as equity investors, we believe the main issue at hand is your expected rate of return to Hexion stockholders after giving effect to the merger.
We are prepared to finance, together with a limited number of other Huntsman stockholders, at least $500 million of the consideration due under the Merger Agreement in the form of a subscription for Contingent Value Rights (gCVRsh) as described in the attached commitment letter. This financing serves the dual purpose of enhancing what we believe is your already reasonable rate of return and facilitating a mutually-beneficial resolution of the current disagreement between you and Huntsman.
The CVRs are similar to an earn-out; they entitle the holders to repayment of the invested amount only if the future cumulative rate of return on Hexion equity passes a certain hurdle rate. If Hexion equity holders do not earn the hurdle rate of return, the CVRs expire without payment. The CVRs are repaid only if the rate of return on Hexion equity outperforms the hurdle rate, a result that we believe is likely enough to warrant our investment.
From Hexionfs perspective, the financing provided in exchange for the CVRs can be used to supplement debt financing for the merger consideration and post-merger liquidity. The result will be less debt service costs and a higher rate of return on equity. The higher returns will be shared with the CVR holders only to the extent that rate of return is in excess of the hurdle rate, which we propose to set at a cumulative annual rate of return of 20%. Note that returns above the hurdle rate are not paid entirely to the CVR holders, but instead are split in equal parts between the CVR holders and Hexionfs other owners. The CVR holdersf total return is then capped at the initially invested amount, after which point all returns are paid 100% to Hexionfs other owners.
The attached commitment letter is in draft form for your review and comment. We are prepared to enter into it immediately in the form attached, or to discuss any comments or suggestions you may have. We also are open to discussing alternative transaction structures (including common or preferred equity investments or mezzanine loans) that reach a similar economic result but are more efficient in your view for tax or other reasons.
Our additional financing proposal does not require due diligence or the review of material non-public information. However, our commitment would be subject to the conditions set forth in the commitment letter. Of particular note:
| @ | E | @ | Our
own commitments of $245,022,716 are subject to Hexionfs receipt of similar
commitments from a limited number of other large
investors in Huntsman (gAdditional Commitmentsh) such that the aggregate
notional amount of all CVR commitments is at least
$500,000,000. We have discussed this proposal with Peter
Huntsman and requested that the Huntsman family and
certain of their controlled entities (the gHuntsman Family
Stockholdersh) join the attached
commitment letter. Peter Huntsman has informed us that it
is his expectation that the Huntsman Family Stockholders
will commit to subscribe for an aggregate of $186,233,986
in notional amount of CVRs on the terms and conditions
set forth in the commitment letter at such time as
sufficient Additional Commitments are received such that
the aggregate of all CVR commitments, including the
commitments of the Huntsman Family Stockholders, is at
least $500,000,000. Based on our analysis of the
institutional ownership of Huntsman common equity, we
believe that at least the requisite amount of Additional
Commitments ($68,743,298) can be obtained from other
large stockholders who see the situation in the same
terms that we do. In the event that you receive
Additional Commitments in excess of that amount, we agree
that you may increase the total amount of CVRs rather
than reduce our own commitments.
|
| @ | E | @ | Our commitments also are subject to Hexionfs acceptance of the commitment letter by September 15, 2008. In accepting the commitment letter, we ask Hexion to confirm that, assuming the gCompany Material Adverse Effecth condition in the Merger Agreement will be satisfied or waived as of the closing date, Hexion has no other reason to believe that any condition precedent to any partyfs obligation to effect the merger will not be timely satisfied or that any party has or will have the right to terminate the Merger Agreement prior to the consummation of the merger. We feel it is important to verify this as part of a bona fide acceptance of our commitments, which require us to allocate capital for the CVR investment and hold a minimum amount of Huntsman stock until consummation of the merger. We do not believe that acceptance of our commitment letter will limit Hexionfs ability to argue (now or later) that a gCompany Material Adverse Effecth has occurred. |
| @ | |||
| @ | E | @ | Finally, our commitments are subject to the consummation of the merger on the terms and at the price specified in the Merger Agreement. Obviously, we do not intend to subscribe for CVRs on the terms described in the commitment letter if the consideration payable under the Merger Agreement is reduced or delayed, or other changes adverse to us are made without our consent. |
Please understand that none of us represents Huntsman or has the authority to bind it. We are making this proposal solely on our own behalf as institutional investors, and not on behalf of Huntsman, the Huntsman family or any other Huntsman stockholders.