Olin and Huntsman merge in $12.5 billion all-stock chemicals deal

Olin and Huntsman will combine in an all-stock merger of equals valued at $12.5 billion in revenue, creating a North American chemicals powerhouse with $400 million in targeted cost synergies.

Olin Corp. and Huntsman Corp. agreed Tuesday to combine in an all-stock merger of equals, creating a $12.5 billion North American chemicals leader with more than $400 million in identified cost synergies and integration benefits. The combined company, to be renamed OlinHuntsman Corp., will be headquartered in The Woodlands, Texas.

"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 Ken Lane, president and chief executive officer of Olin, who will serve as CEO of the combined entity. "By integrating those capabilities with Olin's world-scale chemicals assets and operations and identified synergies and benefits, we will create an industry leader with greater flexibility to serve customers across the value chain."

Under the terms, Huntsman shareholders will receive 0.5476 Olin shares for each Huntsman share, with Olin shareholders owning about 54.5 percent and Huntsman shareholders about 45.5 percent of the combined entity. The exchange ratio was set using volume-weighted average prices over the 30 trading days through June 12, delivering a premium to Huntsman's historical averages while reflecting current market conditions, Peter Huntsman said.

The deal, expected to close in the first half of 2027, brings together Olin's chlor-alkali and epoxy assets with Huntsman's downstream polyurethane systems and advanced materials portfolio. The vertical integration gives OlinHuntsman a structurally lower cost position and expanded ability to convert advantaged Electrochemical Units production into downstream materials, the companies said.

$400 million synergy target

The companies identified more than $300 million of cost synergies and integration benefits, with the vast majority expected within 24 months and all by the end of year three. The savings will come from purchasing and raw material integration, operational optimization and SG&A reductions. An additional $100 million of raw material integration benefits are expected starting in 2031. OlinHuntsman also expects about $125 million of cash tax benefits through the acceleration of net operating losses.

Todd Slater, Olin's senior vice president and chief financial officer, will serve as chief integration officer, reporting to Lane. A strategic integration committee of the board will oversee the process.

Leadership and governance

Ken Lane will lead OlinHuntsman as CEO. Peter Huntsman, currently chairman, president and CEO of Huntsman, will serve as non-executive chairman. Phil Lister, Huntsman's executive vice president and CFO, will become CFO of the combined company. The board will have 10 members with equal representation from both companies.

Olin's Winchester ammunition business will continue as a key unit within the combined company, serving sporting, law enforcement and military customers.

Lazard advised Olin, with Cravath, Swaine & Moore LLP and Sidley Austin LLP as legal counsel. Citi and Morgan Stanley & Co. LLC advised Huntsman, with Kirkland & Ellis LLP as legal counsel.

The transaction requires approval from both Olin's shareholders and Huntsman's stockholders, along with regulatory clearances. The boards of both companies have unanimously approved the deal.

This article is for informational purposes only and does not constitute investment advice.