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Huntsman Declares Pricing of $375M Senior Notes Offering

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Huntsman Corporation (HUN - Free Report) and Venator Materials PLC have priced private offering of senior notes worth $375 million. The aggregate principal amount of offering has been increased from $350 million and the notes will carry an interest rate of 5.75%, which will mature on Jul 15, 2025.

The notes will be offered through their fully-owned subsidiaries Venator Materials Corporation and Venator Finance S.a r.l., to qualified institutional buyers under Rule 144A and will be exempted from registration requirements under the United States Securities Act of 1933.

The company expects the completion of the offering to take place on Jul 14, subject to customary closing conditions.

As communicated earlier, Huntsman plans to separate its Pigments & Additives business this summer through initial public offering (IPO) of Venator Materials PLC, subject to market conditions. The company intends to initially keep the proceeds from note issue into escrow pending the IPO. It will then use the funds to repay intercompany debt owed to Huntsman, dividends and other related fees and expenses.

Shares of Huntsman have rallied around 7.4% in the last three months, outperforming the Zacks categorized Chemicals-Diversified industry’s 1.6% gain.


 

Huntsman witnessed positive business development during the first quarter of 2017. However, revenues of its Performance Products segment declined in the quarter due to lower sales volume as a result of the sale of the European surfactants business to Innospec Inc. (IOSP - Free Report) , which more than offset higher average selling prices and increased volumes in other businesses.

The company’s Advanced Materials segment also witnessed a decline in sales owing to lower volume, as the company withdrew from certain low-margin businesses in the construction and coatings market and faced higher competitive pressure in the wind market that more than offset growth in some of its high value businesses.  

Huntsman Corporation Price and Consensus

 

Huntsman Corporation Price and Consensus | Huntsman Corporation Quote

Huntsman currently carries a Zacks Rank #4 (Sell).

Stocks to Consider

Some better-ranked companies in the basic materials space areThe Sherwin-Williams Company (SHW - Free Report) and Hitachi Chemical Company, Ltd. . Both the stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.

Sherwin-Williams has an expected long-term earnings growth rate of 11.4%.

Hitachi Chemical has an expected long-term earnings growth rate of 5%.

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