Clariant, Huntsman spar with activist investor

Activist investor White Tale Holdings has increased its stake in Clariant to 15% to further its campaign to break up the company’s merger with Huntsman Corp. In a letter to Clariant’s board, White Tale, a venture of hedge fund Corvex and investment fund 40 North, says the deal “both significantly destroys existing Clariant shareholder value and prevents Clariant from pursuing multiple alternative and immediate opportunities to unlock value for its shareholders.” The investor says Clariant should instead sell its plastics and coatings business and become a pure-play specialties company. Clariant defends the deal, saying Huntsman has evolved into primarily a specialties business and is a good fit. Further, it claims the pairing creates substantial value for shareholders, will save $400 million a year in costs, and provides an opportunity to further adjust its combined portfolio. Huntsman also struck back, saying, “In an apparent effort to engineer a short-term rise in the Clariant stock price, White Tale has advanced a destructive, high risk strategy of dismantling Clariant and denying all other stakeholders of the company the sustainable, long-term benefits of this compelling combination.”