The Urethane Blog

Huntsman Takes Loss Divesting TiO2 Stake

Remember when ICI convinced Huntsman to buy the TiO2 business and the Wilton cracker in order to obtain the urethanes business back in 1999? So this divestiture finalizes the total change of Huntsman from a commodity polystyrene business to today’s entity that is now about 60% urethanes . . . A throwback article from the original sale is attached at the bottom.

Huntsman Agrees to Sell its Remaining Interest in Venator Materials PLC

Download as PDF August 28, 2020 5:16pm EDT

THE WOODLANDS, Texas, Aug. 28, 2020 /PRNewswire/ — Huntsman Corporation (NYSE: HUN) announced today that it has entered into a definitive agreement with funds advised by SK Capital Partners, LP to sell approximately 42.5 million of the shares it holds in Venator Materials PLC for a cash purchase price of approximately $100 million, including a 30-month option for the sale of the remaining approximate 9.5 million shares it holds at $2.15 per share.  The transaction is subject to regulatory approvals and is expected to close near year-end.

Together with estimated cash tax savings of approximately $150 million anticipated by offsetting the capital loss on the sale of Venator shares against the capital gain realized on the sale of our chemical intermediates and surfactants businesses that closed this year in January, we expect to secure an aggregate total benefit of approximately $250 million in cash near year end.

Peter Huntsman, Chairman, President and CEO, further commented, “I am pleased to have reached an agreement to sell our remaining interest in Venator to SK Capital.  We enjoy an ongoing relationship with SK Capital and their co-founder Barry Siadat.  They are a great owner and operator of businesses and we are pleased for them to acquire Huntsman’s stake in Venator, a world class functional and specialty TiO2 business.  The proceeds to be received will further bolster our balance sheet and only enhance our flexibility for further growth.

News | May 4, 1999

ICI Divests Urethanes, Titanium Dioxide, Petrochemicals to Huntsman; Refinishing, Industrial Coatings to PPG

Imperial Chemical Industries (ICI, London, UK) continues to divest commodity chemicals in order to concentrate on specialty products. Its latest actions include the £1.7 billion sale of polyurethanes, titanium dioxide and selected petrochemicals businesses to Huntsman Chemical Corp. (Salt Lake City, UT). It will also sell most of its global automotive refinishing and industrial coatings units to PPG Industries Inc. (Pittsburgh, PA) for £425 million.

The first transaction includes polyurethanes, titanium dioxide, and paraxylene. It nearly doubles the size of Huntsman, North America’s largest privately owned chemical company, to more than $7.5 billion. The urethanes and titanium dioxide businesses both have solid technology positions and major global markets.

A German automotive refinisher repairs a car using a PPG waterborne system designed to reduce emissions to comply with increasingly stringent environmental regulations. The purchase of ICI’s global automotive refinish and industrial coatings operations augments PPG’s already-strong franchise in this field.

The deal suddenly makes Huntsman a major presence in 11 countries. It also increases Huntsman capacity by 8.7 billion lb/y, to more than 28 billion lb/y, and adds 7000 to its payroll, bringing it to 16,000. The companies expect to close the deal this summer. Huntsman also says it is interested in purchasing ICI’s acrylics business, which is also up for sale.

The purchase involves three segments:

  • Polyurethane: ICI operates facilities in Wilton, UK; Rozenburg, the Netherlands; and Geismar, LA; with an aggregate net asset value of £523 million. Total capacity is just over 1 billion lb/y, mostly in MDI-based materials though ICI also manufactures some TDI-based materials as well as polyols. It has 50 sales/representative offices worldwide. In 1998, the business achieved a trading profit (after corporate charges) of £90 million on sales of £816 million.
  • Titanium dioxide: ICI’s Tioxide titanium dioxide business has manufacturing sites in Canada, France, Italy, Spain, United Kingdom, and Malaysia, and joint ventures in South Africa and the United States. Its total nameplate capacity approaches 1.3 billion lb/yr with an asset value of £661 million. Trading profits were £58 million on sales of £574 million.
  • Petrochemicals: Huntsman will purchase ICI’s aromatics business (primarily benzene and paraxylene, which is used in polyester and polyurethane production) and ICI’s share of olefins production (chiefly ethylene and propylene for polymers) from the cracker at Wilton, Teeside. The assets are valued at £96 million. The business lost £27 million on sales of £659 million in 1998.

Huntsman will acquire the businesses by forming a new company, Huntsman ICI Holdings (HICI) in partnership with ICI. HICI will include Huntsman’s US propylene oxide business, which earned $79 million on $339 million sales in 1998. ICI will retain a £300 million investment in the new business for a minimum of three years. It will use the remaining £1.4 billion from the transaction to reduce debt incurred with its £8 billion purchase of Unilever’s specialty chemical business in 1997.