Hexion's divestiture of specialty epoxy resins business hinges on merger with Huntsman

By Lisa Kerner

Charlotte, N.C., Sept. 19 - Hexion Specialty Chemicals, Inc. agreed to divest a portion of its global specialty epoxy resins business to Spolchemie, according to a form 8-K filed with the Securities and Exchange Commission.

The transaction is contingent upon the completion of Hexion's pending merger with Huntsman Corp. as well as approval from both the U.S. Federal Trade Commission and the European Commission.

The Huntsman/Hexion merger has been stalled by litigation and solvency issues related to the combined company.

Earlier in the month, a group of Huntsman stockholders agreed to make cash payments to the company in the amount of $416.46 million to facilitate the merger's close.

On July 12, 2007, Hexion agreed to acquire Huntsman in an all-cash transaction valued at approximately $10.6 billion, including the assumption of debt. Huntsman shareholders approved the deal in October 2007.

In June, Hexion said the capital structure agreed to for the combined company is no longer viable and that completing the merger would render the combined company insolvent.

Based in Columbus, Ohio, Hexion makes thermoset resins. Huntsman is a Salt Lake City manufacturer of differentiated chemicals and pigments.

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