Huntsman to sell Chemical Intermediates and Surfactants Businesses

Huntsman has entered into a definitive agreement to sell its chemical intermediates businesses, which includes PO/MTBE, and its surfactants businesses to Indorama Ventures in a transaction valued at US$2.076bn, comprising a cash purchase price of US$2.0bn plus the transfer of up to approximately US$76M in net underfunded pension and other post-employment benefit liabilities.

The US$2.076bn transaction value represents an LTM adjusted EBITDA multiple of approximately 8 times, which includes retained SG&A costs of about US$30M, a portion of which Huntsman expects to eliminate over time.

Under the terms of the agreement, Indorama Ventures would acquire Huntsman’s manufacturing facilities located in Port Neches, Texas; Dayton, Texas; Chocolate Bayou, Texas; Ankleshwar, India; and Botany, Australia.

The transaction is subject to regulatory approvals and other customary closing conditions and is expected to close near year-end.

Peter Huntsman, Chairman, President and CEO commented: “This transaction further transforms Huntsman’s balance sheet and future.

"It accelerates our ability to expand more in areas both downstream and complementary to our portfolio.

"This is another milestone in our stated strategy to focus more on our downstream and speciality businesses, where we will generate more stable margins and consistent, strong free cash flow.

“We are committed to retaining our strong investment grade balance sheet, repurchasing our shares, investing in organic research and select capacity expansions and acquiring strategic assets that are accretive to our earnings and create shareholder value.

“For Indorama Ventures, they will be acquiring a strong EO/PO derivatives business with a very experienced workforce and management team.

"This is also a transformational opportunity for Indorama Ventures that provides them hundreds of product grades and thousands of customers.

"Huntsman looks forward to continuing to work with Indorama Ventures as a customer and manufacturing partner through long-term commercial arrangements, including propylene oxide supply.

“Huntsman intends to accelerate share repurchases under its existing US$1bn multi-year authorisation after the close of this transaction.”

Aloke Lohia, Group CEO of Indorama Ventures, commented: “This acquisition is a momentous propellant in our journey towards our stated goal of being a global, diversified chemicals company with multiple, and related earnings streams.”

Share this page
  • Forthcoming Issue

    Coming up in the February 2020 issue

    • Biocides
    • Mergers & Acquisitions
    • Protective Coatings
    • Resins
    • Middle East Country Focus
    • MECS 2020 Catalogue

    Bonus distribution
    Middle East Coatings Show 2020

    Publication date: Fri 7th Feb 2020
    Editorial deadline: Mon 2nd Dec 2019
    Advertising deadline: Wed 15th Jan 2020

    For information on forthcoming editorial features and deadlines please click here.

Sister publication