Under terms of the deal announced Friday, Covington, Ky.-based Ashland will pay $18.60 a share in cash and 0.093 of a common share for each Hercules share, which amounts to $2.6 billion for the target's equity. Including net assumed debt of $700 million, the deal will be worth $3.3 billion. Based on Ashland's closing stock price Thursday, the deal values Hercules shares at $23.01 each, a 38% premium to the closing price on Thursday.
The deal comes just one day after Dow Chemical Co.'s announcement that it would acquire specialty chemical maker Rohm and Haas Co. in a
cash deal valued at $18 billion.
With sales in more than 100 countries, Ashland manufactures and delivers specialty chemicals, plastics and automotive lubricants, like Valvoline Oil. Wilmington, Del.-based Hercules specializes in additives and ingredients that modify the physical properties of water-based systems and is one of the world's leading suppliers of specialty chemicals to the paper industry. The acquisition will also boost Ashland's position in the pulp and paper business, the company said. The combined businesses will provide additional opportunities in other key water treatment markets, Ashland said, including municipal, industrial and marine.
The cash portion of the deal will be funded through a combination of cash on hand and committed debt financing from Bank of America Corp. and Scotia Capital, a unit of Toronto-based Bank of Nova Scotia. -
Donna BlockSee full story on
TheDeal.com
