Switzerland-based chemicals firm Clariant and US-based Huntsman said their boards unanimously approved a definitive agreement to merge in all-stock transaction that creates a company with a combined enterprise value of $20 billion.
The merged company will be named HuntsmanClariant.
Clariant shareholders will own 52% of the combined firm, with Huntsman shareholders owning 48%.
Global headquarters will be in Pratteln, Switzerland, with operational headquarters in The Woodlands, Texas, and the merged firm will have a dual stock exchange direct listing on the SIX Swiss Exchange and the New York Stock Exchange.
Clariant CEO Hariolf Kottmann will become chairman of HuntsmanClariant, with Huntsman CEO Peter Huntsman becoming CEO of the merged firm.
“On a pro forma 2016 basis, the combination of both companies will create a leading global specialty chemical company with sales of approximately $13.2 billion, an adjusted EBITDA of $2.3 billion and a combined enterprise value of approximately $20 billion at announcement,” said Clariant.
Clariant CEO Hariolf Kottmann said: “This is the perfect deal at the right time. Clariant and Huntsman are joining forces to gain much broader global reach, create more sustained innovation power and achieve new growth opportunities.
“This is in the best interest of all of our stakeholders. Peter Huntsman and I share the same strategic vision and I look forward to working with him.”
Peter Huntsman, CEO of Huntsman, said: “I could not be more enthusiastic about this merger and look forward to working closely with Hariolf Kottmann, a man I have admired and trusted for the past decade.
“We also look forward to a close association with his immensely talented colleagues around the world.
“Together, we will create a global leader in specialty chemicals with a combined balance sheet providing substantial financial strength and flexibility.”
Citi and UBS AG are serving as Clariant’s financial advisors for the transaction, with Homburger and Cleary Gottlieb Steen & Hamilton serving as legal advisors.
BofA Merrill Lynch and Moelis & Company LLC are serving as Huntsman’s financial advisors, with Kirkland & Ellis, Bär & Karrer and Vinson & Elkins acting as legal advisors.