MOSCOW (MRC) -- Westlake Chemical Corporation has provided an update on its pending acquisition of Axiall Corporation, reported BusinessWire.
Axiall and Westlake have received all regulatory approvals required for the transaction, including clearance from both the U.S. and Canadian competition authorities.
On August 1, 2016, Axiall filed a definitive proxy statement with the United States Securities and Exchange Commission to notify Axiall’s shareholders of a special meeting to be held on August 30, 2016 to vote on the transaction. Assuming the Axiall shareholders approve the transaction at that meeting, the closing is expected to occur on August 31, 2016.
As MRC informed earlier, Westlake Chemical Corp. will buy Axiall Corp. for about USD2.33 billion, announced the company in June 2016. In January, Axiall rejected a then USD20 cash-and-stock offer from Westlake, setting off a public back-and-forth takeover battle. Axiall had previously called Westlake’s bid "opportunistic and inadequate," while Westlake had tried to remove Axiall’s board via a proxy fight. Earlier in June, South Korean conglomerate Lotte Chemical Corp. disclosed that it had submitted an unsolicited bid for Axiall, presumably providing the impetus for Westlake to work fast and seal the deal. As part of the transaction, Westlake withdrew its bid to replace Axiall’s board. The transaction has been approved by the boards of both companies and is expected to close in the fourth quarter, pending regulatory approvals and Axiall stockholder approval.
Axiall is a chemical company formed in 2012 from the chemical assets of PPG and Georgia Gulf. The PPG products are primarily chlor-alkali. The combined companies will be the third largest producer of chlor-alkali in the US after Dow Chemical and Occidental. PPG will own 50.5% of the combined companies. The company is headquartered in Atlanta, GA. In 2015, Axiall posted sales of USD3.36 billion - down 12% vs. 2014 - and a loss of USD816.4 million. Most of the loss can be attributed to a non-cash charge of almost USD850 million for goodwill impairment that Axiall took in the third quarter, as the firm wrote down the value of some of its holdings.
Westlake Chemical Corporation is a U.S. manufacturer and supplier of petrochemicals and polymers, headquartered in Houston, Texas. The range of company's products includes ethylene, polyethylene, styrene, propylene, caustics, polyvinyl chloride and plastic products. Westlake is one of the major ethylene producers in the US and its Calvert City operation is a large integrated PVC site. Westlake’s 2015 financial results showed sales of USD4.46 billion and profit of USD646 million. The sales total was up 1% vs. 2014, while the profit level was down almost 5%. Lower selling prices - particularly for polyethylene and ethylene feedstock - impacted Westlake in 2015.
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