Westlake Chemical Corp., Houston, has entered a definitive agreement to acquire Axiall Corp., Atlanta, in a deal that, once completed, would form the third-largest chloralkali producer and second-largest polyvinyl chloride (PVC) producer in North America.
As part of the agreement, Westlake will purchase all of the outstanding shares of Axiall for $33/share in an all-cash transaction, representing an enterprise value of about $3.8 billion, including debt and certain other Axiall liabilities, the companies said in a joint release.
The transaction, which has been unanimously approved by both companies’ boards of directors, is scheduled to be completed by this year’s fourth quarter, pending approval of Axiall's stockholders as well as other customary closing conditions.
In conjunction with the merger agreement, Westlake, which already has secured commitments from its banks to finance the transaction, also has agreed to withdraw its nomination of a slate of director nominees at Axiall’s upcoming annual stockholders’ meeting to be held on June 17.
Upon finalizing the merger, Westlake said it will continue working with South Korea’s Lotte Chemical Corp. and LACC LLC, a subsidiary of Axiall and Lotte Chemical USA Corp.’s 50–50 joint venture Eagle US 2 LLC, to complete LACC’s proposed 1-million tonne/year ethane-based ethylene plant under construction in Lake Charles, La. (OGJ Online, June 9, 2016; Dec. 18, 2015; Sept. 3, 2015; June 18, 2015; Dec. 20, 2013).
The current merger agreement follows Axiall’s rejection of Westlake’s previous offers to purchase its outstanding common shares at $20/share in January and $23.12/share in March, according to Jan. 29 and Apr. 4 releases from Axiall.
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