Huntsman files counterclaims; extends deadline for $11-billion Hexion deal

03 July 2008

Mumbai: Huntsman Corporation has extended the deadline for closing a merger deal with Hexion Specialty Chemicals again, by 90 days to 2 October, and filed a countersuit in the Delaware court to force the reluctant suitor to consummate its $11 billion takeover deal. 

Huntsman first agreed to be acquired by Hexion for $28 per share, or about $10.6 billion, on 12 July 2007.

Huntsman filed its counterclaims in the Delaware court on breach of contract, defamation and other charges. The suit came in response to a 19 June lawsuit by Columbus, Ohio-based Hexion which sought to terminate the year-old merger agreement.

Huntsman, based in Salt Lake City and run from The Woodlands, in its countersuit, also sought a $325 million reverse-break-up fee if the deal doesn't go through, as well as unspecified damages to shareholders.

Together, these damages could top $4.5 billion, given the sharp drop in Huntsman's stock price since Hexion walked out of the merger deal, Peter Huntsman, president and CEO of the company, said.

Hexion, a specialty chemicals company owned by private equity firm Apollo Management, last month withdrew its $28-a-share takeover offer for Huntsman saying the merger was 'not viable.'