Hoechst to acquire stake in Swiss chemicals company
Dec. 10, 1996
FRANKFURT, Germany (AP) _ German chemical maker Hoechst AG said Tuesday it will sell its specialty chemicals business to Clariant AG for about 45 percent of the Swiss company's stock.
Clariant's stock shot up 13.4 percent in Zurich, making the Hoechst stake worth about 914 million Swiss francs ($690 million). Hoechst stock also rose, climbing 3.2 percent in Frankfurt.
Clariant would add Hoechst's pigments business to its paints and chemicals used for coloring textiles, paper, leather, plastics and aluminum, as well as lacquers.
A spokeswoman for Hoechst said the move will make the company Clariant's biggest shareholder, but that Hoechst has no plans to seek a majority stake.
Clariant spokesman Walter Vaterlaus said Hoechst's voting stake would be substantially less than 45 percent, but that details were still being negotiated.
``We have to care about our existing shareholders,'' he said.
The deal still needs the approval of both companies' shareholders and regulators in both countries.
The deal involves Hoechst units with about 6.5 billion marks ($4.19 billion) in annual sales. Clariant's yearly sales totaled around 2.15 billion Swiss francs ($1.62 billion) in 1995. The combined unit will have annual sales of around 9 billion marks ($5.8 billion), Hoechst said.
Hoechst said it is trying to adjust to a difficult global market for specialty chemicals, especially in Europe.
In the first nine months of the year, Hoechst's specialty chemicals lines registered a 16 percent fall in revenue while operating profit lagged other units with a 13 percent rise.
Clariant was spun off by Sandoz AG in the summer of 1995. Currently, its biggest shareholder is Schweizerische Rentenanstalt AG, with 6.1 percent.