HuntsmanClariant Merger on Track

Clariant and Huntsman Corporation presented a first update on the planned merger of equals to keep their shareholders informed. The preparations to create HuntsmanClariant, a leading global specialty chemicals company, are showing continued progress and are proceeding as planned with an unchanged closing targeted for December 2017/January 2018.
 
Clariant and Huntsman have agreed on a joint strategic direction for near- and long-term value creation based on continued focus on higher growth and higher margin businesses, expansion of existing strong downstream presence, reaping benefits of complementary product portfolios and breadth of reach to deliver an additional organic sales revenue growth of around 2% p.a. at approx. 20% EBITDA margin and delivering synergies in excess of $400 million as well as the $25 million tax savings.
 
The merger brings together two specialty chemicals businesses with similar EBITDA margins at 17.2% (including synergies). It will reap complementarity benefits between Performance Products, Care Chemicals and Natural Resources, which represent approximately 35% of HuntsmanClariant combined sales and hold a comprehensive surfactants portfolio in high-end niche markets globally. HuntsmanClariant will take advantage of its broad asset base while continuing to move downstream into specialties and more differentiated applications. As a result of these complementary product portfolios and structures, additional organic sales revenues of around 2% p.a. at approximately 20% EBITDA margin have been identified.
 
The current downstream presence will be expanded by targeting formulation- and application-based segment niches as well as high-end composites, bespoke polyurethane (PU) systems, and costumer oriented and co-developed products. The existing presence in the adaptive chemical methylene diphenyl diisocyanate (MDI) and in chemical building blocks such as ethylene oxide (EO) and propylene oxide (PO) is to be further advanced in downstream urethane systems as well as downstream applications such as surfactants. The portfolio will be simplified. Plastics & Coatings and Textile Effects will be managed for cash and turnaround while all other businesses will be managed for growth and margins.