Huntsman announced on August 7th local time in Texas that it has reached a final agreement with Indorama Ventures to sell the chemical intermediate business and surfactant business including PO / MTBE to the latter. The transaction amounted to $ 2,076 million, including a $ 2 billion cash purchase price, and up to about $ 76 million in underfunded pensions and other after-service benefits liabilities. The $ 2.076 billion deal is equivalent to eight times the adjusted EBITDA over the past 12 months. These include approximately $ 30 million in cost of sales, comprehensive expenses and administrative costs, and Huntsman expects to eliminate some of these costs over time. Under the terms of the agreement, Indorama Ventures will acquire Huntsman's production facilities in Port Nechs, Texas, Dayton, Texas, Gulf of Texas, Anxelwa, India, and Port Botany, Australia. The transaction is subject to regulatory approval and other customary closing conditions and is expected to be completed before the end of the year.
Chairman, President and CEO Peter Huntsman commented:
"This transaction further improves Huntsman's balance sheet and future prospects. The transaction will accelerate our march to downstream areas and to form complementary areas with our portfolio. This is a new step we have achieved in achieving our established strategy. Milestones. Our strategy is to focus more on downstream businesses and specialty products businesses. We will allow these businesses to create more stable profits and stable, strong free cash flow. We are committed to maintaining our strong investment-grade balance sheet and repurchase Stocks, investing in organic research and capacity expansion, while acquiring strategic assets that can bring profit and create shareholder value.
For Indorama Ventures, they will acquire a strong EO / PO derivative business through the transaction, as well as an experienced staff and management team. The transaction is also an opportunity for Indorama Ventures to transform, providing them with hundreds of specifications and thousands of customers. Huntsman looks forward to continuing to work with Indorama Ventures as a customer and production partner through long-term commercial arrangements, including the supply of propylene oxide.
Huntsman intends to speed up share repurchases under its existing $ 1 billion share repurchase program after the transaction. "
Inokeama Ventures Group CEO AlokeLohia commented:
"This acquisition will greatly help us achieve our established strategic goals. Our goal is to become a global diversified chemical company with multiple related sources of profit."
In this transaction, Bank of America Merrill Lynch served as financial advisor to Huntsman and Kay International Law Firm served as its legal advisor.