Issue Date: July 7, 2008
EC Okays Merger of Hexion, Huntsman
The European Commission has cleared Hexion Specialty Chemicals' $10.6 billion takeover of Huntsman Corp., provided that the companies, among other things, sell a portion of their epoxy resins business to an approved third party. The green light comes as Hexion and its parent company, Apollo Management, are suing to back out of the deal. In response to the approval, Hexion reiterated its opinion that the combined company would be insolvent and that Huntsman Corp.'s financial performance has suffered a "material adverse effect" that should scuttle the deal. Hexion CEO Craig O. Morrison and Huntsman CEO Peter R. Huntsman have also been exchanging letters about the deal. Morrison is asking Huntsman to allow the unsealing of Hexion's complaint about the merger in a Delaware court. "Huntsman Corp. shareholders want to see how much Huntsman debt has increased," Morrison's letter states. Huntsman responds that "we cannot and will not agree to the publication of information that is false and misleading about our company." Also last week, Huntsman Corp. filed counterclaims against Hexion's earlier lawsuit in Delaware court. Huntsman wants to force Hexion to close the deal by seeking a judgment that no material adverse effect has occurred.
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