Clariant to Update Strategy, Keeps M&As on the Table

Following the collapse of a deal to merge with Huntsman Corp. in October, Swiss chemical company Clariant AG has announced new plans to update its strategy and set "concrete set of measures" to create value, including mergers and acquisitions.

The announcement came amid pressure by U.S.-based activist majority shareholder White Tale Holdings, which demanded Clariant conduct a reassessment of its strategy using an independent investment bank.

In response, the Muttenz-based specialty chemical company said Nov. 24 that it would present its own updated strategy to investors at its annual general meeting at the beginning of 2018.

The plan, according to Clariant, was developed as a consequence of the termination of the intended merger with Huntsman, forced by activist shareholders.

White Tale, which owns 20 percent of Clariant's shares, was one of the key shareholders against the merger.

Clariant went on to say that the $20 billion "merger of equals" would have accelerated its value creation and generated more than $3.5 billion of shareholder value.

"Clariant's management is fully aware that the new situation following the termination of the merger will require additional efforts to update the strategy which will now be implemented on an accelerated basis," the company added.

Company directors have voiced support for the executive committee's intention to build upon Clariant's existing strategy by "defining further actions such as M&A activities, short-term portfolio management options and potential returns to shareholders."

Clariant said it had the support of Süd-Chemie legacy shareholders, representing approximately 15 percent of the company shares, as well as a majority of institutional shareholders, and would continue "its course of reaching a position in the top tier of the speciality chemicals industry."