BASF acquires Huntsman’s global TDI business
The BASF AG has announced, that it has acquired Huntsman’s TDI business, effective July 6, 2005.
The transaction involves Huntsman transferring its TDI customer list and sales contracts to BASF. This agreement does not include any transfer of manufacturing operations or personnel. BASF has TDI production facilities in Geismar, Louisiana; Schwarzheide, Germany; Yeosu, Korea; and, commencing in 2006, in Caojing, China (in cooperation with Chinese partners). Huntsman’s Geismar, Louisiana TDI manufacturing plant will not be transferred pursuant to the transaction but will be closed. Commenting on the sale, Huntsman’s polyurethanes U.S. Vice President, Greg Geaman, said, "This sale represents a win-win-win situation for our TDI customers, Huntsman and BASF. We are focused on our MDI (diphenylmethane diisocyanate) business, with TDI representing approximately 2% of our total polyurethanes segment revenues in 2004. The sale now leaves us free to focus on MDI growth opportunities, while our customers will continue to enjoy ongoing service and support for their TDI needs from BASF.” “BASF is committed to the global TDI market and looks forward to establishing a successful relationship with Huntsman’s former customers and supplying consistent, high-quality TDI to them,” said Jean-Pierre Dhanis, President of BASF’s Polyurethanes division. Huntsman expects to incur aggregate charges of approximately $39 million in connection with the sale, including a $27 million non-cash write-down of fixed assets and $12 million in cash charges, which include a $10 million net contract termination charge. Huntsman expects to record $37 million of the aggregate charges in the second quarter of 2005, with the remaining $2 million to be recorded by the second quarter of 2006.