MOSCOW (MRC) -- Solvay SA launched a share issue to existing shareholders to complete funding for the Belgian chemicals group's USD5.5 billion purchase of Cytec Industries Inc., said Reuters.
Existing shareholders will receive the right to buy one new share at 70.83 euros for every four existing shares. Solvay shares closed on Wednesday at 105.80 euros.
The rights subscription period will last until Dec. 15. with settlement on or around Dec. 21.
Solvay said it expected to close its acquisition of Cytec on Dec. 9 after securing conditional antitrust clearance from the European Commission.
Solvay shareholder Solvac has committed to exercise in full its rights and thereby maintain its 30.20 percent stake. Also it announced a two-for-five rights issue of up to 452 million euros at an issue price of 74 euros.
In buying Cytec, Solvay will gain a leader in lightweight composite materials for which there is increasing demand from the aerospace and automotive sectors as they seek to reduce carbon dioxide emissions. It will also add to Solvay's existing formulations to maximise the amount of ore extracted in mining.
Solvay sold USD1.6 billion of bonds Tuesday after a 2.25 billion euro bond and 1.0 billion hybrid bond issue last week.
As MRC informed earlier, on July 28, 2015, Solvay entered into a definitive agreement with U.S.-based Cytec to acquire 100% of its share capital for USD75.25 per share in cash. The acquisition has been approved by Cytec’s shareholders, but is still subject to customary closing conditions, including regulatory approvals. The transaction is expected to close before the current year-end.
Cytec Industries Incorporated, based in Woodland Park, New Jersey is a speciality chemicals and materials technology company with pro-forma sales in 2004, including the Surface Specialties acquisition, of approximately USD3.0 billion. Cytec is a result of its spin-off from American Cyanamid Company. It makes resins, plastics, and composite materials, especially for the aerospace industry and other users of specialty materials.
Solvay S.A. is a Belgian chemical company founded in 1863, with its head office in Neder-Over-Heembeek, Brussels, Belgium. The company has diversified into two major sectors of activity: chemicals and plastics. Solvay supplies over 1500 products across 35 brands of high-performance polymers - fluoropolymers, fluoroelastomers, fluorinated fluids, semi-aromatic polyamides, sulfone polymers, aromatic ultra polymers, high-barrier polymers and cross-linked high-performance compounds.
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