Chemical companies Olin and Huntsman have agreed to a ‘merger of equals’ to form ‘OlinHuntsman’ with a total annual revenue of over $12 billion (£9 billion).
Olin is predominantly a chlor-alkali business, electrolysing salt to produce chlorine and sodium hydroxide, along with derivatives including polyvinyl chloride (PVC) and sodium hypochlorite. It also produces epoxy resins and manufactures Winchester ammunition. Huntsman makes various speciality chemicals and polymer components, as well as epoxides, curing agents and additives. Its largest segment produces methylene diphenyl diisocyanate (MDI) and other polyurethane materials.
‘This combination provides a compelling opportunity for Olin and Huntsman to create a more resilient and value-focused chemicals company anchored in North America,’ said Olin’s chief executive, Ken Lane. Many of Olin’s chemicals will feed into Huntsman’s production lines. This includes using Olin’s chlorine to make phosgene that feeds into Huntsman’s MDI production, or combining epichlorohydrin production – which both companies use to produce epoxy resins.
The companies have said that the merger will save more than $300 million in annual costs by 2029, with an additional $100 million a year in savings from raw material integration by 2031. Lane will head the new US-based business, with Huntsman’s current president Peter Huntsman serving as chair. Shareholders of Olin and Huntsman will own 54.5% and 45.5% of OlinHuntsman, respectively. The new company will be headquartered in Woodlands, Texas, where Huntsman is currently based.
Earlier this month, Huntsman sold its Italian polymer automotive parts business, Huntsman Gomet, for €42.5 million (£37 million). Equally, in March, Huntsman said that it was considering closing its aniline manufacturing plant in Wilton, UK, owing to high energy prices, raw materials and labour costs making it cheaper to produce the chemical overseas.
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