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High confidence in meeting
synergy target in excess of $400 million and $25 million tax saving
target
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Additional organic sales
revenues of around 2% p.a. at approx. 20% EBITDA margin
identified
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Highly complementary product
portfolios creating production set-up and
supply chain benefit opportunities in specific overlapping
businesses
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Stronger balance sheet and more
capital for organic growth, value creating add-on acquisitions and
capital return
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Venator standalone debt
financing of $750 million secured; IPO
roadshow underway
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Muttenz, July 27, 2017 - Clariant (SIX: CLN) and
Huntsman Corporation (NYSE: HUN) today presented a first update on
the planned merger of equals to keep their shareholders informed.
The preparations to create HuntsmanClariant, a leading global
specialty chemicals company, are showing continued strong progress
and are proceeding as planned with an unchanged closing targeted
for December 2017 / January 2018.
Clariant and Huntsman have agreed on a joint
strategic direction for near- and long-term value creation based on
continued focus on higher growth and higher margin businesses,
expansion of existing strong downstream presence, reaping benefits
of complementary product portfolios and breadth of reach to deliver
an additional organic sales revenue growth of around 2% p.a. at
approx. 20% EBITDA margin and delivering synergies in excess of
$400m as well as the $25m tax savings.
The merger brings together two strong specialty
chemicals businesses with similar EBITDA margins at 17.2%
(including synergies). It will reap complementarity benefits
between Performance Products, Care Chemicals and Natural Resources,
which represent approx. 35% of HuntsmanClariant combined sales and
hold a comprehensive surfactants portfolio in high-end niche
markets globally. It will have meaningful opportunities for growth
including cross-selling potential and new product applications. The
complementary assets and geographic fit provide significant
commercial opportunities and more global reach within established
routes to market. Furthermore, HuntsmanClariant will take advantage
of its broad asset base while continuing to move downstream into
specialties and more differentiated applications. As a result of
these complementary product portfolios and structures, additional
organic sales revenues of around 2% p.a. at approx. 20% EBITDA
margin have been identified.
HuntsmanClariant's position as a leading global
specialty chemicals company will further benefit from complementary
R&D and technological expertise as well as shared knowledge in
sustainability and cross-fertilization in innovation and technology
capabilities.
The portfolio management principles and capital
allocation plans of the new company are fully aligned. There is a
clear joint understanding of the combined company's future core
segments and the direct majority of investments will be directed to
growth areas and growth regions. The current downstream presence
will be expanded by targeting formulation- and application-based
segment niches as well as high-end composites, bespoke polyurethane
(PU) systems, and costumer oriented and co-developed products. The
existing presence in the adaptive chemical methylene diphenyl
diisocyanate (MDI) and in chemical building blocks such as ethylene
oxide (EO) and propylene oxide (PO) is to be further advanced in
downstream urethane systems as well as downstream applications such
as surfactants. The portfolio will be simplified. Complexity will
be reduced while utilizing significant strategic flexibility to
consider value creating add-on acquisitions and divestments.
Plastics & Coatings and Textile Effects will be managed for
cash and turnaround while all other businesses will be managed for
growth and margins.
The project team is progressing very well in terms
of joint synergy implementation and has high confidence in meeting
the synergy target in excess of $400m as well as the $25m tax
saving target. Key regulatory filings are submitted, including in
the US, EU and China. No regulatory roadblocks are expected to
closing the deal. A preliminary CFIUS filing has also been
submitted.
The joint senior management team is committed to
making HuntsmanClariant a success from day 1. It is a unique
opportunity to combine the best of two cultures - Huntsman's
entrepreneurship and efficiency and Clariant's innovation and
business excellence. Both CEOs and executive teams are fully
involved in post-merger integration planning and the great working
spirit confirms the cultural fit between both organizations.
All in all, the merger will create value for all
stakeholders via a stronger balance sheet, higher cash flow,
increased stakeholder returns and lower financing costs and will
allocate capital for organic growth and value creating portfolio
management.
Update on Venator IPO
The Venator standalone debt financing of $750
million is secured. The IPO roadshow is now underway. It will
provide significant de-leveraging of HuntsmanClariant balance
sheet.
Clariant and Huntsman will communicate regular
updates on the merger preparation until closing.
Cautionary Statement Regarding
Forward-Looking Statements
This communication contains certain statements
that are "forward-looking statements" within the meaning of Section
27A of the Securities Act of 1933, as amended (the "Securities
Act"), and Section 21E of the Securities Exchange Act of 1934, as
amended. Clariant Ltd ("Clariant") and Huntsman Corporation
("Huntsman") have identified some of these forward-looking
statements with words like "believe," "may," "could," "would,"
"might," "possible," "will," "should," "expect," "intend," "plan,"
"anticipate," "estimate," "potential," "outlook" or "continue," the
negative of these words, other terms of similar meaning or the use
of future dates. Forward-looking statements in this communication
include, without limitation, statements about the anticipated
benefits of the contemplated transaction, including future
financial and operating results and expected synergies and cost
savings related to the contemplated transaction, the plans,
objectives, expectations and intentions of Clariant, Huntsman or
the combined company, the expected timing of the completion of the
contemplated transaction and information relating to the proposed
initial public offering of ordinary shares of Venator Materials
PLC. Such statements are based on the current expectations of the
management of Clariant or Huntsman, as applicable, are qualified by
the inherent risks and uncertainties surrounding future
expectations generally, and actual results could differ materially
from those currently anticipated due to a number of risks and
uncertainties. Neither Clariant nor Huntsman, nor any of their
respective directors, executive officers or advisors, provide any
representation, assurance or guarantee that the occurrence of the
events expressed or implied in any forward-looking statements will
actually occur. Risks and uncertainties that could cause results to
differ from expectations include: uncertainties as to the timing of
the contemplated transaction; uncertainties as to the approval of
Huntsman's stockholders and Clariant's shareholders required in
connection with the contemplated transaction; the possibility that
a competing proposal will be made; the possibility that the closing
conditions to the contemplated transaction may not be satisfied or
waived, including that a governmental entity may prohibit, delay or
refuse to grant a necessary regulatory approval; the effects of
disruption caused by the announcement of the contemplated
transaction making it more difficult to maintain relationships with
employees, customers, vendors and other business partners; the risk
that stockholder litigation in connection with the contemplated
transaction may affect the timing or occurrence of the contemplated
transaction or result in significant costs of defense,
indemnification and liability; ability to refinance existing
indebtedness of Clariant or Huntsman in connection with the
contemplated transaction; other business effects, including the
effects of industry, economic or political conditions outside of
the control of the parties to the contemplated transaction;
transaction costs; actual or contingent liabilities; disruptions to
the financial or capital markets, including with respect to the
initial public offering of ordinary shares by Venator Materials PLC
or financing activities related to the contemplated transaction;
and other risks and uncertainties discussed in Huntsman's filings
with the U.S. Securities and Exchange Commission (the "SEC"),
including the "Risk Factors" sections of Huntsman's annual report
on Form 10-K for the fiscal year ended December 31, 2016 and the
quarterly report on Form 10-Q for the six month period ended June
30, 2017. You can obtain copies of Huntsman's filings with the SEC
for free at the SEC's website (www.sec.gov). Forward-looking
statements included herein are made only as of the date hereof and
neither Clariant nor Huntsman undertakes any obligation to update
any forward-looking statements as a result of new information,
future developments or otherwise, except as expressly required by
law. All forward-looking statements in this communication are
qualified in their entirety by this cautionary statement.
Important Additional Information
and Where to Find It
NO OFFER OR SOLICITATION
This communication is not intended to and does not
constitute an offer to sell or the solicitation of an offer to
subscribe for or buy or an invitation to purchase or subscribe for
any securities or the solicitation of any vote or approval in any
jurisdiction, nor shall there be any sale, issuance or transfer of
securities in any jurisdiction in contravention of applicable law.
No offer of securities will be made except by means of a prospectus
meeting the requirements of Section 10 of the Securities Act.
IMPORTANT ADDITIONAL INFORMATION WILL BE FILED
WITH THE SEC
In connection with the contemplated transaction,
Clariant intends to file a registration statement on Form F-4 with
the SEC that will include the Proxy Statement/Prospectus of
Huntsman. The Proxy Statement/Prospectus will also be sent or given
to Huntsman stockholders and will contain important information
about the contemplated transaction. INVESTORS AND SHAREHOLDERS ARE
URGED TO READ THE PROXY STATEMENT/PROSPECTUS AND OTHER RELEVANT
DOCUMENTS FILED OR TO BE FILED WITH THE SEC CAREFULLY WHEN THEY
BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION
ABOUT CLARIANT, HUNTSMAN, THE CONTEMPLATED TRANSACTION AND RELATED
MATTERS. Investors and shareholders will be able to obtain free
copies of the Proxy Statement/Prospectus (when available) and other
documents filed with the SEC by Clariant and Huntsman through the
website maintained by the SEC at www.sec.gov.
PARTICIPANTS IN THE SOLICITATION
Huntsman and its directors and executive officers
may be deemed to be participants in the solicitation of proxies
from Huntsman investors and shareholders in connection with the
contemplated transaction. Information about Huntsman's directors
and executive officers is set forth in its proxy statement for its
2017 Annual Meeting of Stockholders and its annual report on Form
10-K for the fiscal year ended December 31, 2016. These documents
may be obtained for free at the SEC's website at www.sec.gov.
Additional information regarding the interests of participants in
the solicitation of proxies in connection with the contemplated
transactions will be included in the Proxy Statement/ Prospectus
that Huntsman intends to file with the SEC.
Corporate Media Relations
|
|
Investor Relations
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Jochen Dubiel
Phone +41 61 469 63 63
jochen.dubiel@clariant.com |
|
Anja Pomrehn
Phone +41 61 469 63 73
anja.pomrehn@clariant.com |
Thijs Bouwens
Phone +41 61 469 63 63
thijs.bouwens@clariant.com |
|
Maria Ivek
Phone +41 61 469 63 73
maria.ivek@clariant.com |
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www.clariant.com
Clariant is a globally leading specialty chemicals
company, based in Muttenz near Basel/Switzerland. On 31 December
2016 the company employed a total workforce of 17 442. In the
financial year 2016, Clariant recorded sales of CHF 5.847 billion
for its continuing businesses. The company reports in four business
areas: Care Chemicals, Catalysis, Natural Resources, and Plastics
& Coatings. Clariant's corporate strategy is based on five
pillars: focus on innovation through R&D, add value with
sustainability, reposition portfolio, intensify growth, and
increase profitability.
First Merger Update -
Presentation
First Merger Update - Press Release