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Huntsman Corp., the specialty chemical company founded by Utah's Jon Huntsman Sr., announced a merger with Clariant AG, a Swiss rival of roughly the same size.
The all-stock deal expected to close by the end of the year will create a company with a combined market value of about $13.2 billion.
The new entity will be called HuntsmanClariant, and Huntsman chief executive Peter Huntsman will serve as the combined company's CEO. Clariant CEO Hariolf Kottmann will take the role of chairman. Huntsman Sr. will serve as the chairman emeritus and a board member.
Peter Huntsman said in a statement announcing the deal late Monday that he "could not be more enthusiastic about this merger."
"It gives us greater size, it gives us greater technology and a much wider portfolio of technology and products," he told The Salt Lake Tribune in an interview. "This just makes us among the largest specialty chemical companies in the world."
The Huntsmans first raised the prospect of a major merger last December, after it decided to spin off its pigments and additives division, which tends to have big financial swings, into a company called Venator Materials Corp. That company will also be traded on the New York Stock Exchange. Huntsman Corp. saw its revenues decline by 6 percent to roughly $10 billion last year, but the company saw a stock surge after announcing the spinoff.
"We are probably more open to the idea of a potential merger than we would have been in the past," Peter Huntsman told the Houston Chronicle at the time.
According to a Reuters report, Huntsman Corp. was involved in serious talks with Clariant late last year, though they broke down when Clariant executives weren't prepared to sell off part of the business and become minority players. Peter Huntsman told The Tribune that he's been talking with executives at Clariant for eight years though this deal came together in the last three weeks.
The merger appears more evenly split, mirroring their current market size. Huntsman stockholders will own 48 percent of the company and Clariant's will take 52 percent, with the board of directors evenly split between representatives of Clariant and Huntsman.
The merger comes at a time when the chemical industry is seeing more consolidation as companies seek new revenue by streamlining costs and expanding into more markets.
Huntsman Corp. has its executive headquarters in Salt Lake City — which will remain in place — though much of the company is run out of The Woodlands, Texas, where Peter Huntsman serves as president and CEO. The Woodlands will remain the operational headquarters of the company, though its global headquarters will be in Pratteln, Switzerland.
Huntsman Sr. founded his company in 1970, making a fortune on styrofoam food containers. It since has grown into one of the world's biggest specialty chemical companies, and it went public in 2005.
Before the merger, Huntsman Corp. operated more than 100 manufacturing and research facilities in roughly 30 countries, with a workforce of about 15,000 people.
Clariant, which makes de-icing fluid for planes, colorings for plastics and ingredients for pesticides, has a workforce of similar size.
Peter Huntsman said he doesn't expect any closures of manufacturing plants, though there may be some streamlining on the business services side.
Editor's note • Paul Huntsman, a son of Huntsman Corp. founder Jon Huntsman Sr., is the owner and publisher of The Salt Lake Tribune.