IVL Announces the Acquisition of “Huntsman Corp.” to Enhance the New Growth Engines

Following the news published by Kaohoon Online yesterday regarding the rumors of Indorama Venture Public Company Limited (IVL) was near an agreement to acquire the U.S. multinational company, Huntsman Corporation. Today, IVL has finally made an announcement of its resolution for a new acquisition.

 

The Board of Directors’ Meeting No. 6/2019 of IVL held on July 29, 2019 has passed a resolution to approve the acquisition of certain integrated Oxides and Derivatives businesses/assets from Huntsman Corporation, USA, a listed entity on New York Stock Exchange and its wholly owned subsidiaries whether directly or indirectly.

Huntsman and its subsidiaries manufacture the following key products: Ethylene Oxide (EO), Propylene Oxide (PO), Glycols, Ethanolamines (EOA), Surfactants, Linear Alkylbenezene (LAB),and Methyl Tertiary-butyl Ether (MTBE), including certain R&D Centers, patents and technology by IVL.

 

The Transaction will broaden IVL’s expertise of operating US Gulf Coast (USGC) Integrated Oxides facility through operational excellence, global scale, differentiated formulations and technologies and fits into its growth segments of Integrated EOs and the Specialty Chemicals portfolio consisting of both Ethylene Oxide and Propylene Oxide platforms.

The acquired businesses is fully integrated downstream in Surfactants used in personal home care and in Propylene Oxides used in insulation and foam materials. These leading downstream businesses will be the core platform for continuous growth in selective upstream & downstream integration over the next 5-10 years.

On a proforma basis, this acquisition will add 25% to IVL’s 2018 core EBITDA and also 23% of additional manufacturing capacity in higher-margin businesses.

 

The total value of consideration for the Transaction is USD 2 billion (equivalent to approximately THB 61,960 million). Moreover, IVL shall also assume pension obligations of up to approximately USD 76 million (equivalent to approximately THB 2,354 million).

The transaction of USD 2 billion will be funded from IVL’s own internal resources and IVL will enter into the bridge loan facility agreement with financial institution(s) for the total amount of up to USD 1,500 million. In the latter case, there is no condition in the financing agreements that will have an effect on the rights of IVL’s shareholders.