Chemical Giants Clariant and Huntsman Agree to Merge

      The merger, targeted for completion by the end of 2017, will create HuntsmanClariant, a leading global specialty chemicals company with an estimated enterprise value of approximately USD 20 billion. Earnings will be further enhanced through accelerated growth in attractive end-user markets and significant geographies such as the United States and China. The combined innovation platforms will be strengthened, while opportunities for knowledge sharing in sustainability will emerge. A stronger balance sheet and cash flow will be created, and Clariant's attractive dividend policy is planned to continue. Huntsman's previously announced initial public offering of its Pigments and Additives business unit (Venator) will proceed as planned in summer 2017. Clariant and Huntsman Corporation announced that the final merger agreement, covering all shares of the two equal-sized companies, has been unanimously approved by their respective Boards of Directors. The resulting company will be named HuntsmanClariant. Based on estimated 2016 figures, the merger of the two companies will create a significant global specialty chemicals company with approximately USD 13.2 billion in sales, USD 2.3 billion in adjusted EBITDA, and a combined enterprise value of approximately USD 20 billion as of the announcement date. Through this merger, both parties will benefit from each other's strengths and have significant growth opportunities in attractive end-user markets and geographies.

HuntsmanClariant will leverage its accumulated expertise in sustainability to drive a significantly stronger joint innovation platform. All these advantages are expected to enable the development of new products that will generate strong earnings and increase shareholder value.

Clariant CEO Hariolf Kottmann stated, "This is an excellent deal at the right time. Clariant and Huntsman are combining their strengths to achieve a broader global presence, create innovation power with high sustainability value, and unlock new growth opportunities." "This development will serve the interests of all our shareholders. I share the same strategic vision with Peter Huntsman and look forward to working with him," he said. Peter R. Huntsman, President and CEO of Huntsman Corporation, commented: "This merger excites me greatly and I look forward to working with Hariolf Kottmann, whom I have admired and trusted for the past decade. We are also eager to work closely with his talented colleagues around the world. Together, we will create a global brand with a combined balance sheet that will provide us with significant financial strength and flexibility in the specialty chemicals sector.

Value Creation

The new company will accelerate value creation for shareholders through a stronger combination of technology, products and talent. The combined company is expected to create more than USD 3.5 billion in value based on approximately USD 400 million in annual cost synergies. Full realization of the annual synergy projection will be achieved within two years following the closing of the merger. These synergies will be realized through reduction of operating costs and enhanced purchasing. The targeted synergies, together with one-time costs of up to USD 500 million, represent approximately 3% of the combined 2016 revenue. Additionally, there will be incremental cash tax savings.

Timing

The merger of the two companies is targeted to be completed by year-end 2017, subject to approvals by Clariant and Huntsman shareholders, regulatory approvals and other customary closing conditions. Clariant and Huntsman believe that required regulatory approvals can be obtained on a timely basis.