Eastman to Acquire Solutia
January 27, 2012
by Sahely Mukerji, firstname.lastname@example.org
Officials at Eastman Chemical Co. of Kingsport, Tenn., and Solutia
Inc. of St. Louis, have entered into a definitive agreement, under
which Eastman will acquire Solutia. Under the terms of the agreement,
Solutia stockholders will receive $22 in cash and 0.12 shares of
Eastman common stock for each share of Solutia common stock.
"Solutia board of directors has agreed to a merger with Eastman
Chemicals for an enterprise value of approximately $4.7 billion,"
says Melissa H. Zona, director of corporate communications at Solutia.
"Eastman's offer represents a substantial premium for our shareholders.
The agreement calls for the merger of the companies, which Solutia's
board of directors unanimously recommends be adopted by its shareholders."
The merger creates a company with combined revenues of about $9.3
billion, Zona says.
"The merger is financially compelling for Solutia's shareholders,
enabling investors to benefit over the long term from the combined
company's growth," Zona adds. Solutia shareholders will receive
cash and stock valued at $27.65 per Solutia common share, representing
a premium of 42 percent and a total transaction value of approximately
$4.7 billion, including the assumption of Solutia's debt, she says.
"The acquisition of Solutia is a significant step in our growth
strategy and one that I am confident will strengthen Eastman as
a top-tier specialty chemical company with strong, stable margins,"
says Jim Rogers, chairman and CEO of Eastman, in a company release.
"The addition of Solutia will broaden our geographic reach
into emerging geographies, particularly Asia
Pacific, establish a powerful combined platform with extensive
organic growth opportunities, and expand our portfolio of sustainable
products, all of which are consistent with our growth strategy.
"This transaction is also expected to deliver immediate value
to our stockholders in the form of accretion and strong cash generation,
as well as create potential upside through the combination of two
leading global chemical companies," Rogers says in the release.
"This complementary transaction will accelerate the growth
of our businesses around the world," says Jeffry N. Quinn,
chairman, president and CEO of Solutia, in the release. "This
transaction provides Solutia's shareholders with immediate value
and an attractive premium, as well as the opportunity to benefit
from the future prospects of a leading global chemicals producer
with the financial strength, a diversified mix of premium products,
and the geographic footprint to capitalize on long-term growth opportunities."
for more details.
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