HUNTSMAN
Hexion owner outbids Basell owner for US chemical group / Private equity funds in bidding war?
Just when it appeared virtually certain that Huntsman (Salt Lake City, Utah / USA; www.huntsman.com) would be snapped up by Access Industries, owner of polyolefin market leader Basell (Hoofddorp / The Netherlands; www.basell.com) – see Plasteurope.com Web of 28.06.2007 – private equity investor Apollo (New York, New York; www.apolloic.com) has stepped in with a higher bid for the US chemical group.
The Apollo offer of nearly USD 10.4 bn on behalf of wholly owned Hexion Specialty Chemicals (Columbus, Ohio / USA; www.hexionchem.com) tops by USD 2.0 per share the USD 9.6 bn offered by the investment company of Russian-born billionaire Len Blavatnik on 26 June 2007.
The two private equity firms, bidding separately, came up empty handed in the race for GE Plastics, which went to Saudi petrochemical giant Sabic for USD 11.6 bn. Some observers see a bidding war shaping up among investment funds, not only for Huntsman, but possibly for other major petrochemical assets. Blavatnik’s Access is believed to still have an option to take a majority of US-based Lyondell and some speculate that it also may be interested in Canada’s Nova Chemicals.
In a statement, Huntsman noted that accepting the Hexion proposal would be subject to termination of its “definitive merger agreement” with Basell. If Huntsman does terminate the deal, Basell and Access will be entitled to a USD 200m payment, which would be split by Huntsman and Hexion. The Hexion owner also has offered Huntsman a payment of USD 325m if the deal fails for regulatory reasons. That company’s transaction committee in Salt Lake City is “continuing to evaluate” which bid is better. In unveiling the Access bid, CEO Peter Huntsman told US journalists the company had already held talks with “several” private equity buyers.
Apollo is one of the few private equity firms investing in the chemicals and plastics sector that have acquired several assets separately and successfully shaped them into a new company. Hexion was formed in 2005 by piecing together Borden Chemicals, and parts of the Resolution group, including thermoset producer Bakelite – see Plasteurope.com Web of 05.05.2005. The merged thermoset resins producer claims to be the market’s global leader.
The Apollo offer of nearly USD 10.4 bn on behalf of wholly owned Hexion Specialty Chemicals (Columbus, Ohio / USA; www.hexionchem.com) tops by USD 2.0 per share the USD 9.6 bn offered by the investment company of Russian-born billionaire Len Blavatnik on 26 June 2007.
The two private equity firms, bidding separately, came up empty handed in the race for GE Plastics, which went to Saudi petrochemical giant Sabic for USD 11.6 bn. Some observers see a bidding war shaping up among investment funds, not only for Huntsman, but possibly for other major petrochemical assets. Blavatnik’s Access is believed to still have an option to take a majority of US-based Lyondell and some speculate that it also may be interested in Canada’s Nova Chemicals.
In a statement, Huntsman noted that accepting the Hexion proposal would be subject to termination of its “definitive merger agreement” with Basell. If Huntsman does terminate the deal, Basell and Access will be entitled to a USD 200m payment, which would be split by Huntsman and Hexion. The Hexion owner also has offered Huntsman a payment of USD 325m if the deal fails for regulatory reasons. That company’s transaction committee in Salt Lake City is “continuing to evaluate” which bid is better. In unveiling the Access bid, CEO Peter Huntsman told US journalists the company had already held talks with “several” private equity buyers.
Apollo is one of the few private equity firms investing in the chemicals and plastics sector that have acquired several assets separately and successfully shaped them into a new company. Hexion was formed in 2005 by piecing together Borden Chemicals, and parts of the Resolution group, including thermoset producer Bakelite – see Plasteurope.com Web of 05.05.2005. The merged thermoset resins producer claims to be the market’s global leader.
06.07.2007 Plasteurope.com [208490]
Published on 06.07.2007
German version of this article...