Huntsman To Divest Two Chemical Units To Indorama For $2.1B
Zacks Investment Research | Aug 12, 2019 08:08AM ET
Huntsman Corporation (NYSE:HUN) recently entered into a definitive agreement with Indorama Ventures to divest its chemical intermediates businesses, including PO/MTBE, and its surfactants businesses.
The transaction is valued at $2.076 billion, which comprises a cash purchase price of $2 billion along with the transfer of up to roughly $76 million in net underfunded pension as well as other post-employment benefit liabilities. The deal is expected to close near the end of 2019, subject to regulatory approvals and other customary closing conditions.
Per the deal terms, Indorama Ventures will buy Huntsman's Texas-based manufacturing facilities located in Port Neches, Dayton and Chocolate Bayou. It will also acquire the Ankleshwar, India and Botany, Australia facilities.
Per Huntsman, the transaction transforms its balance sheet and accelerates its ability to expand in downstream areas. The deal is another milestone in terms of its strategy to focus on downstream and specialty businesses. The company believes that the deal will enable it to generate more stable and consistent margins as well as strong free cash flow.
Huntsman also stated that it intends to accelerate share repurchases under its existing $1-billion multi-year authorization following the transaction closure.
Huntsman's shares have gained 4.7% year to date against the Zacks Investment Research
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.