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Business

Two chemical makers ready stock offerings

AlzChem and Venator prepare to offer shares in first half of 2017

by Michael McCoy
January 23, 2017 | APPEARED IN VOLUME 95, ISSUE 4

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Credit: Huntsman Corp.
Credit: Huntsman Corp.

Chemical stock offerings are off to a strong start in 2017. The German specialty chemical firm AlzChem plans an initial public offering (IPO) of stock in the first half. Huntsman Corp., meanwhile, is pushing ahead with the IPO of its titanium dioxide business—now without a textile chemicals component.

AlzChem was formed in 2009 when Evonik Industries sold a business in chemicals with nitrogen-carbon-nitrogen bonding to a private equity firm. Now in the hands of three family-owned companies, Alzchem had sales in the first nine months of 2016 of about $265 million.

AlzChem plans to raise up to $50 million that it will spend on a new plant for guanidinoacetic acid, a feed additive that animals convert into the amino acid creatine.

Huntsman says the spin-off of its $2 billion-per-year business in the white pigment titanium dioxide and other additives is on track for the second quarter of 2017. It has chosen Venator Materials—venator is the Latin word for hunter—as the name for the new firm.

However, in a change from previous plans, Huntsman now says its textile chemicals business won’t be part of the new company. CEO Peter R. Huntsman says improved pricing for titanium dioxide plus cash from business improvement opportunities will more than offset the cash flow Venator would have received from the textile chemicals business.

“We expect Venator will be a premier pigments company unencumbered by excessive debt or other unrelated liabilities,” Peter Huntsman says. In 2009, an earlier TiO2 spin off, Tronox, went bankrupt because of unrelated liabilities.

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