THE WOODLANDS, Texas (AP) -- Chemical maker Huntsman Corp. said Tuesday it received $425 million in payments from Hexion Specialty Chemicals Inc., the final installment of its $1 billion settlement for terminating an earlier buyout deal.
In July 2007 Hexion, an affiliate of Apollo Management L.P., agreed to buy Salt Lake City-based Huntsman for $6.5 billion but then tried to cancel the deal, citing Huntsman's deteriorating finances. After a number of court challenges, Huntsman finally let privately held Columbus, Ohio-based Hexion walk away for a $1 billion settlement in December.
"We have received the $1 billion in payments sooner than anticipated," Chief Executive Peter Huntsman said, adding that the payments bolster the company's balance sheet for 2009.
Huntsman received $325 million on Dec. 19, and an additional $250 million four days later from Apollo affiliates for 10-year convertible notes issued by Huntsman.
The cash infusion may give Huntsman's shares a short-term bounce, but in a recent investors' note Citi Investment Research analyst P.J. Juvekar said the company's "long-term fundamentals are not as strong given a deepening recession and high debt load."
Huntsman reported earlier this month in a Securities and Exchange Commission filing that top executives bought huge chunks of company stock, including CEO Peter Huntsman, Chief Financial Officer J. Kimo Esplin and General Counsel Samuel Scruggs. Anthony Hankins, who runs the company's polyurethane business, also increased his stake in the company.
Shares of Huntsman gained 5 cents to $3.43 in morning trading.
