Huntsman Announces Antitrust Review Complete


Huntsman Corporation (HUN) and Rockwood Holdings, Inc. (ROC) announced that they have achieved an important objective in Huntsman's pending acquisition of Rockwood's Performance Additives and Titanium Dioxide (TiO2) businesses. As per the Hart-Scott-Rodino Antitrust Improvements Act of 1976, the waiting period has expired and the antitrust review in the United States is complete.

In Sep 2013, Huntsman entered into an agreement with Rockwood to acquire its TiO2 Pigments, Color Pigments & Services, Timber Treatment Chemicals, Rubber/Thermoplastics Compounding, and Water Chemistry businesses. Huntsman agreed to pay $1.1 billion in cash and assume $225 million in pension obligations, subject to other customary adjustments for the acquisition, leading to an enterprise value of $1.325 billion. The deal is subject to necessary regulatory approvals and is expected to be completed by the first half of 2014. Huntsman is continuing to work through the regulatory process in the European Union.

The TiO2 Pigments business was Rockwood’s biggest business unit in 2012 with sales of roughly $900 million, representing about 25% of total sales of nearly $3,700 million. The divestiture is in line with Rockwood’s aim to become a more focused specialty chemical company. It is now uniquely positioned to implement its long-term business strategy that will enhance shareholders’ value.

Huntsman is a major producer of TIO2, PU and other specialty materials. The acquisition will make the company the world's second-largest TIO2 producer. Huntsman currently holds a Zacks Rank #3 (Hold).

Other companies in the chemical industry worth considering include Asahi Kasei (AHKSY) and Johnson Matthey plc. (JMPLY). Both Asahi Kasei and Johnson Matthey carry a Zacks Rank #1 (Strong Buy).

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