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Vantico to become part of Huntsman following debt-equity swap

Published on 2003-02-06. Author : SpecialChem

 

Huntsman Chemical is to take over Vantico after one of its shareholders bought a majority stake in the struggling epoxy resins, composites and adhesives company. The deal is due to be completed at the end of March.

Vantico's bondholders, including MatlinPatterson Global Opportunities and Morgan Grenfell Private Equity, have agreed to swap their debt for a 95% stake in Vantico. Other bondholders have the option to take equity, or have bonds redeemed for 30% of face value.

The deal will give MatlinPatterson a majority stake in Vantico. MatlinPatterson says it will transfer Vantico to its daughter company Huntsman (today, Matlin Patterson owns 49% of Huntsman). As a result of the deal, it will have a controlling interest in Vantico and is expected to use Huntsman's chemicals expertise to run the company.
Epoxy resins maker Vantico has "terrific prospects", said Huntsman CEO Peter Huntsman, but he add that once the deal is completed he would be proud to have Vantico join the group.

Morgan Grenfell, meanwhile, pledged to inject SF75 million ($55 million) into Vantico as part of the agreement. The deal is subject to negotiation of a definite agreement and must be approved by Vantico's bank group.

Vantico is the former epoxy business of Ciba, which was sold in 2000 to a management buyout team backed by Morgan Grenfell. Vantico's operating profits fell 79% in the third quarter of 2002, to SF5 million, on sales down 9%, to SF358 million.
Vantico chief executive Helmut Strametz said the deal would establish a stronger firm, providing opportunities to work alongside the Huntsman business.


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