Flint Hills to buy Huntsman commodities business

15 February 2007 14:01  [Source: ICIS news]

LONDON (ICIS news)--Huntsman has agreed to sell its base chemicals and polymers business to Flint Hills Resources for $761m (€579m), its chief executive Peter Huntsman announced on Thursday.

 

Under the agreement, Flint Hills will acquire the manufacturing assets of Huntsman’s US commodities business for $456m in cash plus $286m - value of inventory on the 31 December closing date.

 

The transaction includes Huntsman’s olefins and polymer plants at Port Arthur, Odessa and Longview, Texas; Peru, Illinois; and Marysville, Michigan, which together employ around 900 people.

 

The deal was expected to close in the third quarter.

 

Not included in the sale was the captive ethylene unit at Port Neches, Texas, which will continue to supply feedstock to Huntsman’s downstream derivative units.

The Woodlands, Texas-based company sold its US butadiene business to Texas Petrochemical in June for $192m and is now due to complete its transformation into a differentiated chemicals company.

“Upon the closing of the transaction we announced today, Huntsman Corporation will have completed its planned divestitures of its commodity petrochemical businesses and its transformation to a company manufacturing and marketing differentiated products,” said Peter Huntsman.

 

"Our entire product line will now experience higher growth rates and much lower sensitivity to energy costs," said Peter Huntsman," he added.

 

The transaction is expected to close during the third quarter of 2007 following the re-start of Huntsman's Port Arthur, Texas, olefins manufacturing facility, subject to customary regulatory approvals and other closing conditions.

 

"We are excited about this proposed acquisition and its natural extension of our existing capabilities in petrochemical manufacturing and marketing,” said president of Flint Hills Resources Brad Razook.

 

Wichita, Kansas-based Flint Hills is a wholly owned subsidiary of Koch industries and a large producer of fuels, based oils and other petrochemical products in the US.

 

($1=€0.76)


By: Mark Watts
+44 20 8652 3214



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