Eastman Chemical Deals for Taminco

Wednesday, September 17, 2014 @ 10:09 AM gHale

Eastman Chemical Co. will acquire Taminco Corp. for $1.8 billion in cash to add a line of chemicals used in water treatment and agriculture.

Eastman Chairman and Chief Executive Mark Costa is betting on rising demand for technologies that boost food output, with 46 percent of Taminco sales coming from products sold to farmers and ranchers. Taminco has about 1,000 employees at eight manufacturing sites who make amines, chemicals used in animal feed, crop chemicals, solvents and personal care products.

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Taminco shareholders will receive $26 a share, Kingsport, Tennessee-based Eastman said. That’s 8.9 percent more than yesterday’s closing price. The transaction also gained approval from Apollo Global Management LLC, the majority owner of Taminco, the Allentown, PA-based company said.

Taminco said it plans to actively solicit alternate proposals under the agreement’s 30-day “go-shop” provision. Seeking other bids “provides a real opportunity to determine if there are alternatives superior to the present offer from Eastman,” Taminco Chief Executive Laurent Lenoir said in the statement.

The transaction is valued at $2.8 billion including assumption of about $1 billion of Taminco’s debt, Eastman said. That makes Taminco the second biggest acquisition for Eastman after its 2012 purchase of Solutia Inc. for $4.5 billion, according to Bloomberg.

Taminco is the world’s largest producer of alkylamines and alkylamine derivatives, made by blending ammonia with an alcohol, such as methanol. Competitors include DuPont Co., BASF SE and Celanese Corp.

The raw materials used by Taminco come from natural gas, now abundant in the U.S. as a result of increased drilling in shale formations.

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