Huntsman Corporation’s (NYSEP:HUN) merger with Clariant AG (VTX:CLN), a Swiss based company is still facing resistance from its shareholders. Goldman Sachs was recently recruited to convince the opposing party to get onboard with the high-profile union.
Goldman Sachs is up against Keith Meister, a hedge fund manager, who along with his partners holds a 10% stake in Clariant AG (VTX:CLN). Meister has been quite vocal about his anti-merger sentiments. It is believed the hedge fund manager has been rallying to throttle the deal, saying the merger would greatly undervalue the shares of the Swiss company.
Goldman Sachs will be facing a stiff challenge, not only does Meister know his game, he learned it from one of the best; he is the protégé of billionaire activist investor Carl Icahn.
The merger between the two companies will result in the second biggest specialty chemical company in the world. The decision to get Goldman Sachs involved was taken by Clariant AG (VTX:CLN) to address all relative concerns of the company’s shareholders.
A chemical industry analyst at Alembic Global Adivsors, Hassan Ahmed believes the merger will very likely come to a close towards the end of this year. According to him, Goldman Sachs will be able to present effective counter arguments against all the alternatives and suggestions presented by Mesiter team.
Activist investors rarely lose in the United States, however things are not quite the same in the European region. Ahmed also said since Clariant AG (VTX:CLN) has no other suitor with a better offer, Mesiter may not have a strong case.
The analyst went on to say Clariant AG (VTX:CLN) put itself up for sale a few years ago and during this time was unable to secure any appropriate offers. During these disappointing times Huntsman’s (NYSEP:HUN) offer was nothing short of a gift. Ahmed believes a merger with Huntsman (NYSEP:HUN) will be a great opportunity for the Swiss company because it will offer it direct access to the United States markets.
Ahmed also said Clariant AG (VTX:CLN) will also be able to access cost effective shale gas feedstocks in the United States for its chemical products. This certainly seems like a win-win situation for Clariant.
The merged company will be valued at around $14 billion. The headquarters will be set up in Pratteln, Switzerland; it is believed the move is being made partly for tax purposes. The newly formed company will also have its headquarters in North America. The Chief Executive of Huntsman (NYSEP:HUN) Peter Huntsman will take the position of CEO in the combined company.
Huntsman (NYSEP:HUN) currently has a market cap of about $6.16 billion. The stock’s 52-week range is between $14.16 and $28.30. Shares are currently trading close to the higher side of this range.
Company Profie: Huntsman Corporation (NYSEP:HUN) manufactures differentiated organic and inorganic chemical products.