By Jennifer Chiou
New York, July 5 - Hexion Specialty Chemicals Inc. said it made a definitive proposal to the board of Huntsman Corp. to acquire the company for $10.4 billion, including refinanced debt, or $27.25 per share in cash.
The offer represents a premium of about 8% over Basell AF's previously announced agreement to acquire Huntsman for $25.25 per share and includes an 8% per year increase, net of Huntsman dividends, in the event that the transaction requires more than nine months to complete.
On June 26, Basell said it agreed to acquire Huntsman in a cash transaction valued at about $9.6 billion, including debt. Both companies' boards of directors had unanimously approved the deal, which was expected to close in the fourth quarter.
Hexion added that its proposal is fully financed linked to commitments from Credit Suisse and Deutsche Bank.
The transaction requires regulatory approvals and approval from Huntsman shareholders.
The Hexion proposal is also subject to the termination of Hunstman's merger agreement with Basell.
Moreover, Hexion's proposal also includes a $325 million reverse break-up fee payable by Hexion to Huntsman if the transaction does not close due to the failure to obtain regulatory clearance or financing.
Based in Columbus, Ohio, Hexion is involved in thermoset resins and is owned by an affiliate of Apollo Management, LP. Huntsman is a Salt Lake City manufacturer of differentiated chemicals and pigments.
| Acquirer: | Hexion Specialty Chemicals Inc.
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| Target: | Huntsman Corp.
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| Transaction total: | $10.4 billion
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| Price per share: | $27.25
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| Announcement date: | July 5
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| Stock price for target: | NYSE: HUN; $18.90 on June 25; $24.40 on July 3
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