Investor upheaval has derailed one of the biggest deals in the chemicals industry this year.
According to Reuters, Texas-based Huntsman Corporation and Switzerland's Clariant have called off the $20 billion deal the companies had touted as a “merger of equals.”
Reports that the deal was in trouble started back in July, when two of Clariant’s investors — Corvex Management and 40 North — emailed a statement, expressing concerns that the deal would not unlock shareholder value. The pair urged Clariant, which specializes in care chemicals, catalysis, natural resources, and plastics and coatings, to seek other options.
The companies argued that the deal would produce $400 million in annual cost-saving synergies. Clariant would have also had a 52 percent stake in the combined company, which would have been the world’s second-biggest specialty chemicals manufacturer behind Evonik.
But after 40 North increased its stake in Clariant and joined forces with another investor, White Tale, the investors won the argument.
According to Reuters, activists investors in Switzerland have become increasingly aggressive about having a say in major company decisions.
Reuters reports that Huntsman’s CEO said he was “disappointed” that the deal has fallen apart.
