Huntsman shares rise on bid

Huntsman Corp. shares rose 13 percent Thursday after the U.S. chemical maker got a $6.35 billion takeover offer from Apollo Management LP, topping a bid from billionaire Len Blavatnik's Access Industries Holdings LLC.

The shares for the Salt Lake-based company surged $3.06 to $27.46 in New York Stock Exchange. The Apollo offer was announced late Tuesday, after the close of regular trading. U.S. markets were closed Wednesday for the Independence Day holiday.

Apollo, a New York-based buyout firm, offered $27.25 a share, $2 more than Access' bid on June 26 and 44 percent above the previous day's close. Apollo's Hexion Specialty Chemicals division, the leading producer of binding resins used in plywood, would combine with Huntsman, the world's biggest maker of epoxy adhesives. Access seeks to add specialist products to Dutch chemicals unit Basell Holdings.

"Both companies have good reason to want Huntsman, and I think both will do their utmost to get it, so this could be the beginning of a bid battle," said Marcus Konstanti, chemical analyst at Sal. Oppenheim in Cologne, Germany. "It depends on what savings are available to Apollo and Hexion and whether the purchase is a must-have for Basell to diversify its activities."

Peter Huntsman, president and chief executive officer of Huntsman Corp., was unavailable for comment Thursday. A company spokesman declined to comment to the Deseret Morning News on Thursday about possible effects the second offer would have on the company's Utah operations. Peter Huntsman said last week that under the Access offer, the roughly 50 employees at the world headquarters in the Salt Lake office, as well as the 1,000 employees in the Houston area, will be unaffected by the acquisition at least for the next year.

Peter Huntsman, son of founder and Chairman Jon Huntsman Sr., said last week the family would receive about $1.5 billion from a sale to Access, with about $1 billion going to his parents, who would use $600 million to fund charitable foundations. The company spokesman Thursday declined to comment to the Deseret Morning News on how the Apollo offer differs on those matters.

Huntsman Corp. said on Tuesday that its board and a committee of independent directors concluded that the Apollo bid "could reasonably be expected to lead to a superior proposal," and talks with Hexion have started. Huntsman, run from Salt Lake City and Houston, had revenue of $2.65 billion in the first quarter.

Jefferies & Co. analyst Laurence Alexander said that the bidding for Huntsman might go as high as $28 a share, eight times earnings before interest, tax, depreciation and amortization. "Anything above that depends on synergies," Alexander, based in New York, said.