Huntsman Corporation announced today that it has completed its acquisition of the minority interests held by affiliates of SISU Capital Limited and other third parties representing approximately 9.7% of the equity in its subsidiary Huntsman Advanced Materials LLC (“AdMat”) for $125 million.
AdMat manufactures and markets advanced epoxy, acrylic and polyurethane-based products used in a wide variety of industrial and consumer applications. The AdMat Division of Huntsman produces over six thousand grades of products sold to more than six thousand customers globally. 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.
In conjunction with this acquisition, all of the remaining AdMat senior secured notes have been redeemed in full and Huntsman Corporation has contributed all of its ownership interests in AdMat to its wholly owned subsidiary Huntsman International LLC (“HI”). In addition, HI has amended its senior secured credit facilities and increased its existing term loan B by $350 million. HI used proceeds of the term loan, together with approximately $74 million of cash on hand, to redeem the entire 11% $250 million AdMat senior secured notes due 2010, to pay $35.6 million in call premiums plus accrued interest, to fund the acquisition of minority interests in AdMat and to pay other related costs.
Kimo Esplin, Executive Vice President and Chief Financial Officer, stated, “This is one of the company’s important remaining steps in simplifying its organizational and financial reporting structure and will result in interest savings, reduced administrative costs and a more efficient tax structure. This transaction is expected to be accretive to our earnings per share in 2006. In addition, the acquisition of these minority interests in AdMat furthers our strategy to strengthen and build our differentiated businesses.”
The company expects that it will record a charge for early extinguishment of debt of approximately $46 million in the fourth quarter 2005.