Olin and Huntsman have agreed to an all-stock merger valued at approximately $2.43 billion. This deal, announced on June 16, aims to create a combined North American chemicals company with over $12 billion in annual revenue, known as OlinHuntsman. Under the terms, Huntsman shareholders will receive 0.5476 Olin shares for each share they own. Based on LSEG data, this values the deal at roughly $13.85 per share for Huntsman, which is about 12.8% below Huntsman's closing price before the announcement. Despite the announced synergies, Huntsman shares dropped 13% and Olin's fell 2.4% in morning trading following the news.
The combined entity, OlinHuntsman, will be headquartered in The Woodlands, Texas, and is expected to close in the first half of 2027. Olin shareholders will own approximately 54.5% of the combined company, with Huntsman shareholders owning about 45.5%. The merger intends to generate more than $400 million in cost synergies, with $300 million anticipated within the first two years and an additional $100 million in raw material integration benefits starting in 2031. Furthermore, the companies expect to realize about $125 million in cash tax benefits through the acceleration of Net Operating Losses.
Ken Lane, Olin's current CEO, will lead OlinHuntsman as CEO, while Peter Huntsman, Huntsman's CEO, will serve as non-executive chairman. Phil Lister, Huntsman's CFO, will become CFO, and Olin's CFO Todd Slater will be chief integration officer. The merger is designed to vertically integrate Olin's upstream manufacturing and feedstock capabilities, including chlorine and caustic soda, with Huntsman's downstream products and formulation expertise, aiming for increased scale, scope, and reduced costs in a challenging global chemicals market facing stagnant demand, rising production costs in Europe, and supply chain disruptions like the closure of the Strait of Hormuz.
