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Huntsman to Acquire Minority Interest in Huntsman Advanced Materials LLC

Published on 2005-12-02. Author : SpecialChem

The Woodlands, TX -- Huntsman Corporation (NYSE: HUN) announced that it has reached a definitive agreement with affiliates of SISU Capital Limited ("SISU") to acquire for approximately $125 million the 9.7% minority interest in Huntsman Advanced Materials LLC ("AdMat") that is currently owned by these SISU affiliates and by other third parties.

AdMat manufactures and markets advanced epoxy, acrylic and polyurethane-based products used in a wide variety of industrial and consumer applications. Examples include resins and adhesives used in the manufacture of wind turbine blades; materials used by the consumer electronics industry to improve the functionality and reduce the size of their products; multi-functional resins used in the production of structural composite materials used in many modern aerospace applications and adhesives used to affix insulating panels to the hull of cryogenic liquid natural gas tankers.

Immediately following the acquisition, it is anticipated that AdMat will become a subsidiary of Huntsman International LLC ("Huntsman International"). At the time of the acquisition, it is also expected that all of AdMat’s outstanding senior secured notes will be refinanced with available cash balances of approximately $63 million and the net proceeds of a $350 million increase to Huntsman International’s existing term loan B due 2012. The closing of the acquisition and redemption of the notes are conditioned upon, among other things, obtaining financing to fund these items and are expected to be completed by year end.

According to Kimo Esplin, Executive Vice President and Chief Financial Officer, "The acquisition of the Advanced Materials minority interests represents an attractive valuation and the refinancing will allow Huntsman to continue to simplify its capital and reporting structure. The transaction is also expected to result in lower interest costs and a more efficient tax structure. This transaction is expected to be accretive to our earnings per share in 2006."

AdMat has called all of its $250 million aggregate principal amount of senior secured fixed rate notes due 2010 for redemption on December 20, 2005. The redemption is conditioned upon new financing sufficient to redeem these notes. In addition, AdMat has called its remaining $25 million aggregate principal amount of senior secured floating rate notes due 2008 for redemption on December 12, 2005.

Huntsman is a global manufacturer and marketer of differentiated and commodity chemicals. Its operating companies manufacture basic products for a variety of global industries including chemicals, plastics, automotive, aviation, footwear, paints and coatings, construction, technology, agriculture, health care, textiles, detergent, personal care, furniture, appliances and packaging. Originally known for pioneering innovations in packaging, and later, rapid and integrated growth in petrochemicals, Huntsman today has 11,300 employees, 57 operations in 22 countries and had 2004 revenues of $11.5 billion.

Statements in this release that are not historical are forward-looking statements. These statements are based on management’s current beliefs and expectations. The forward-looking statements in this release are subject to uncertainty and changes in circumstances and involve risks and uncertainties that may affect the company’s operations, markets, products, services, prices and other factors as discussed in the Huntsman companies’ filings with the Securities and Exchange Commission. Significant risks and uncertainties may relate to, but are not limited to, financial, economic, competitive, environmental, political, legal, regulatory and technological factors. Accordingly, there can be no assurance that the company’s expectations will be realized. The company assumes no obligation to provide revisions to any forward-looking statements should circumstances change, except as otherwise required by securities and other applicable laws.

Source: Huntsman Corporation


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