Basell backs away from higher bid for Huntsman

12 July 2007 04:44  [Source: ICIS news]

SINGAPORE (ICIS news)--European polyolefins producer Basell late on Wednesday backed away from a bidding war with Hexion Specialty Chemicals, and reaffirmed its $25.25 a share offer for Huntsman.

Its merger agreement “valued Huntsman at a full and fair price, and offered certainty and the ability to close rapidly”, said Basell, adding that the majority shareholders of Huntsman signed a voting agreement with Basell in support of the merger agreement.

The company said in a statement that it has since been notified by Huntsman that the offer by Hexion is “superior” to Basell’s existing merger agreement.

However, “Hexion offer faces a lengthy and complex regulatory approval process and…closing the Hexion transaction will require many months and is subject to uncertainty,” said Basell, adding it will monitor the situation.

Incidentally, a Huntsman shareholder has filed a lawsuit seeking to block Basell’s acquisition of Hunstman.

Huntsman announced on 26 June that it had agreed to be acquired for $25.25/share by Basell, the chemicals segment of Access Industries.

Apollo Management, which includes Hexion Specialty Chemicals, subsequently issued its own bid for Huntsman at $27.25/share, which it subsequently raised to $28/share.

Under the terms of the agreement, Basell will be entitled to a $200m (€146m) payment if Huntsman terminated the merger agreement to accept the Hexion offer.

Huntsman, which is run from Salt Lake City and Houston, is the world’s biggest maker of epoxy adhesives and has a wide portfolio including performance products, polyurethanes, pigments and advanced materials.

($1 = €0.73)

By: Jeanne Lim
+65 6780 4359

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