It increasingly looks like the styrenic block copolymer (SBC) merger between Kraton Performance Polymers (Houston, Texas / USA; www.kraton.com) and LCY Chemical Corporation (Taipei; www.lcy.com.tw/en) will not proceed as planned. Although the two companies in January announced a “definite” agreement to merge their respective SBC activities, a process they expected to be completed by Q4 this year (for details, see Plasteurope.com of 30.01.2014), following the decline in operating results for LCY’s SBC business in the first quarter of this year, the US company on 30 June notified its proposed Taiwanese partner that its board plans to withdraw the recommendation that the two companies merge.

Under their combination agreement, Kraton must give LCY five business days to respond to its communication by proposing revisions or adjustments that would allow the US group’s board to change its recommendation once again. It is open to the two companies to renegotiate their original agreement to make it more palatable to Kraton’s stockholders, a process that the US company said could take a while. In this respect, Kraton said it “does not intend to make further public comment regarding the status of any such negotiations unless and until the parties enter into an amendment to the combination agreement effecting such changes, or unless and until Kraton determines that any such negotiations have been abandoned.”