Huntsman Corporation · NYSE:HUN
Huntsman — Merger or Acquisition (June 2017)
57 slides from Huntsman's merger presentation, Jun 7, 2017
Slide 1: Cautionary Statement Regarding Forward-Looking Statements
Cautionary Statement Regarding Forward-Looking Statements This communication contains certain statements that are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, a
Slide 2: General Disclosure (Cont'd)
General Disclosure (Cont’d) Important Additional Information and Where to Find It NO OFFER OR SOLICITATION This communication is not intended to and does not constitute an offer to sell or the solicitation of an offer to subscribe for or buy or an invitation to purchase or subscribe for any securiti
Slide 3: Key Transaction Highlights
Key Transaction Highlights Merger of equals creates leading global specialty chemical company with ~$20 billion enterprise value at announcement More than $3.5 billion of value creation through annual cost synergies in excess of $400 million Enhanced returns from complementary high growth end market
Slide 4: Transaction Overview
Transaction Overview All-stock merger of equals transaction New company to be named HuntsmanClariant At-market combination(1): Huntsman shareholders: 48%, Clariant shareholders: 52% Huntsman shareholders receive 1.2196 shares in HuntsmanClariant for each Huntsman share Strong transaction commitment
Slide 5: HuntsmanClariant – A Leading Global Specialty Chemical Company
HuntsmanClariant – A Leading Global Specialty Chemical Company ~$20bn Enterprise Value at Announcement(1) ~$14bn Market Capitalization at Announcement(1) $13.2bn 2016 Sales $2.3bn 2016 Adjusted EBITDA Implying 17% Margin(2) $1.9bn 2016 Operating Cash Flow(3) $360mn 2016 R&D Spend 28,200 2016 Employe
Slide 6: HuntsmanClariant – A Leading Global Specialty Chemical Company (2016 Sales)
HuntsmanClariant – A Leading Global Specialty Chemical Company 2016 Sales ($bn) Note: USD in billions. Excludes Flavors and Fragrances, Industrial Gases, and Paints and Coatings peers. Evonik is pro forma for the acquisitions of Air Products Performance Materials and J.M. Huber Silica business. Depi
Slide 7: HuntsmanClariant – Attractive and Balanced Portfolio
Combined EBITDA margin(1) HuntsmanClariant – Attractive and Balanced Portfolio 2016 Sales 2016 EBITDA 11% Care Chemicals 14% Performance Products 28% Polyurethanes 7% Advanced Materials 9% Natural Resources 5% Catalysis 6% Textile Effects 20% Plastics & Coatings 13% Care Chemicals 13% Performance Pr
Slide 8: Balanced Geographic Footprint with Increased Strength in North America and China
HuntsmanClariant – Balanced Geographic Footprint with Increased Strength in North America and China North America (27% of sales) China (11% of sales) Note: Based on 2016 sales mixes. Huntsman is pro forma for the announced separation of its Pigments and Additives business, Venator. Significantly inc
Slide 9: Focused on Key Growth Markets
Focused on Key Growth Markets Contributed by Huntsman Business Contributed by Clariant Highlights Care Chemicals Critical solutions provider to end-markets supported by secular lifestyle-driven megatrends 4 – 5% 18 – 19% Natural Resources Innovative, performance enhancing and tailored service soluti
Slide 10: Estimated Annual Cost Synergies in Excess of $400mn
Estimated Annual Cost Synergies in Excess of $400mn Description Cost Synergies More than $3.5bn in projected market value creation from realization of synergies $400mn full synergy run-rate to be achieved within 2 years of closing Procurement synergies of $150mn Increase effectiveness of combined sp
Slide 11: Strong Track Record and Culture of Business Improvement
Strong Track Record and Culture of Business Improvement Demonstrated Standalone EBITDA Margin Enhancement Enhanced Combined Financial Profile Performance driven culture with focus on increased profitability and downstream margin improvement Successful acquisition track record with strong integration
Slide 12: Focused on Growing End Markets
Focused on Growing End Markets Consumer Transportation Construction Industrial Energy Portion of 2016 Sales Application Examples Source: Management estimates. Note: Huntsman is pro forma for the announced separation of its Pigments and Additives business, Venator. Personal Care Textile Packaging The
Slide 13: Focused on Key Growth Markets
Focused on Key Growth Markets HuntsmanClariant Leverage complementary products and channel overlap – same customers / end markets for different products More complete solutions for multi-material platforms at OEMs Vibration Control Steering Wheels Interior Trim Growth Opportunities from Complementar
Slide 14: Innovation, Technology and Sustainability Will Drive Growth
Innovation, Technology and Sustainability Will Drive Growth Note: CHF converted at an average exchange rate of 0.988 USD/CHF. HuntsmanClariant Clariant Biotech Center, Munich, Germany Clariant Innovation Center, Frankfurt, Germany Huntsman R&D facility, Shanghai, China Huntsman Advanced Technology C
Slide 15: Enhanced Financial Profile
Enhanced Financial Profile A $13bn Specialty Chemical Group Attractive Margin Expansion Opportunities Operating Cash Flow(2) Strong Balance Sheet with Commitment to Investment Grade Rating Additional potential for sales synergies from cross-selling to existing customers Margin 15.2% 13.4% 17.2% Syne
Slide 16: Key Investment Highlights, Conclusion and Next Steps
Shareholders’ Meetings Key Investment Highlights Conclusion and Next Steps Transaction Benefits: Global specialty chemical leader In excess of $400mn in annual cost synergies Combined end markets and geographies drive growth Innovation and sustainability enhance value creation Robust balance sheet a
Slide 17: Conclusion and Next Steps
HUNTSMAN CLARIANT® Conclusion and Next Steps Transaction Bens ™ Global specialty chemical leader ™ In excess of $400mn in annual cost synergies ™ Combined end markets and geographies drive growth ™ Innovation and sustainability enhance value creation ™ Robust balance sheet and strong cash flow f > >
Slide 18: Focused on Key Growth Markets: EBITDA Growth in Key Specialty Markets
Focused on Key Growth Markets HUN EBITDA Growth in Key Specialty Markets 16
Slide 19: Moving Products Downstream into Formulations
Formulations / Markets Focused on Key Growth Markets HUN Performance Products / CLN Care Chemicals & Natural Resources – Moving Products Downstream into Formulations North America 17 Oilfield Services Personal Care Agriculture Europe Oilfield Services Personal Care Agriculture Care Chemicals 19% CHF
Slide 20: Complementary Production Value Chain Will Drive Synergies
Steam cracker Propylene glycols Propylene carbonates Ethylene glycols Ethylene carbonates EO Ethylene Specialized products Raw Materials & Intermediates Propylene Huntsman’s Performance Products Ethoxylates PO Amines EO Ethoyxlates Externally sourced Clariant’s Care Chemicals Propoxylates Amines Eth
Slide 21: Estimated Annual Cost Synergies in Excess of $400mn
Estimated Annual Cost Synergies in Excess of $400mn 19 Procurement ~$150mn Corporate Office, and Asset Consolidation (~$200mn) Other Operational (~$50mn) Cash tax savings in excess of $25 million from optimizing the use of combined NOLs Source: Management estimates. Operational ~$250mn Optimization
Slide 22: Integration Case Studies: Clariant / Süd-Chemie & Huntsman / Rockwood
Integration Case Studies: CLN / Süd-Chemie & HUN / Rockwood Clariant / Süd-Chemie Integration Highlights Announced synergies ~6% of Süd-Chemie sales(3) with little/no business overlap Realized ~20% more cost savings compared to announced cost savings Integration ~10% below budget Integration and syn
Slide 23: Huntsman Reconciliation of U.S. GAAP to Non-GAAP Measures
Huntsman Reconciliation of U.S. GAAP to Non-GAAP Measures Pro forma adjusted to include the October 1, 2014 acquisition of the Performance Additives and Titanium Dioxide business of Rockwood Holdings, Inc. as if consummated at the beginning of the period; excludes the related sale of our TR52 produc
Slide 24: Polyurethanes
Polyurethanes MDI Urethanes End Markets Revenues MDI Competitive Intensity Adjusted EBITDA History 1Q17 LTM Revenues $3.8 billion Adjusted EBITDA $582 million 2016 Revenues 2016 Revenues $ in millions Source: Management Estimates Consumer 37% INSULATION ELASTOMERS AUTOMOTIVE INTERIORS COMPOSITE WOOD
Slide 25: Performance Products
Performance Products End Markets(1) Revenues(1) Global HUN Market Share Adjusted EBITDA History(1) 1Q17 LTM Revenues(1) $1.9 billion Adjusted EBITDA(1) $287 million 2016 Revenues 2016 Revenues $ in millions Source: Management Estimates Consumer 15% Product Market Share Peer Polyetheramines >60% BASF
Slide 26: Advanced Materials
Aero, Transp & Ind Advanced Materials End Markets Revenues Competitive Landscape Adjusted EBITDA History 1Q17 LTM Revenues $1.0 billion Adjusted EBITDA $217 million 2016 Revenues 2016 Revenues $ in millions Source: Management Estimates Consumer 18% Coatings & Electrical Diversified AUTOMOTIVE ADHESI
Slide 27: Textile Effects
Textile Effects End Markets Revenues Competitive Landscape Adjusted EBITDA History 1Q17 LTM Revenues $0.8 billion Adjusted EBITDA $76 million 2016 Revenues 2016 Revenues $ in millions Source: Management Estimates Consumer 100% AUTOMOTIVE SEATING APPAREL Dyes & Chemicals Chemicals Dyes Regional Sales
Slide 28: Textile Effects
Textile Effects Protectve “2M Fabrics o% Transporation tt Insttutonal Fumshings 1% Adjusted EBITDA Pacific 56% a i Competitive Landscape Adjusted EBITDA History mi _ Dyes & Chemicals. OS) = x ——- — 2010 «2011 2012-2013 «2014-2015 2016 1017 um 28 HUNTSMAN
Slide 29: Disclaimer
Disclaimer Equity Story Clariant 2017 30 This presentation contains certain statements that are neither reported financial results nor other historical information. This presentation also includes forward-looking statements. Because these forward-looking statements are subject to risks and uncertain
Slide 30: Table of Contents
Table of Contents Equity Story Clariant 2017 31 Who we are Objectives and Strategy Innovation and Sustainability Financial Excellence Highly Experienced Management Summary Outlook
Slide 31: Table of Contents
CLARIANT Table of Contents — Who we are - Objectives and Strategy - Innovation and Sustainability — Financial Excellence - Highly Experienced Management — Summary — Outlook
Slide 32: Clariant at a glance
Clariant at a glance A GLOBALLY LEADING COMPANY IN SPECIALTY CHEMICALS Equity Story Clariant 2017 33 Business Areas Net result 2016 (CHF m) from continuing operations Sales 2016 (CHF m) from continuing operations 5 847 263 4 17 442 EBITDA 2016 (CHF m) before exceptionals 15.2 % 887 EBITDA margin 201
Slide 33: We are a leading specialty chemical company
We are a leading specialty chemical company 34 Sales by business area and in % of group in CHF m, total 2016: 5 847 Truly Global Presence Sales and Sales Distribution by region in CHF m, total 2016: 5 847 419 (7 %) Middle East & Africa 846 (14 %) Latin America 2 004 (34 %) europe 1 458 (25 %) Asia/P
Slide 34: Group Target: EBITDA margin of 16-19% and ROIC above peer group average
Group Target: EBITDA margin of 16-19 % and ROIC above peer group average Equity Story Clariant 2017 35 Care Chemicals Catalysis Natural Resources Plastics & Coatings SALES (CHF m) 1 465 EBITDA (CHF m) 276 EBITDA margin 18.8 % * Over a cycle All actual figures refer to FY 2016; EBITDA and EBITDA marg
Slide 35: Clariant's products and services are grouped into four Business Areas
Clariant’s products and services are grouped into four Business Areas First Quarter 2017 36 Natural Resources BA Natural Resources, comprises the BUs Oil & Mining Services and Functional Minerals. It is characterised by high growth and low cyclicality as well as a strong megatrend orientation. Main
Slide 36: Clariant's products and services are grouped into four Business Areas
Fist quater 20%7 CLARIANT— Clariant’s products and services are grouped into four Business Areas Care Chemicals Business Area (BA) Care Chemicals comprises the Business Unit Industrial & Consumer Specialties (ICS), Food Additives as ‘well as the future Industrial Biotechnology business. It ‘demonstr
Slide 37: Financial objectives
Financial objectives Growth EBITDA* margin Operating Cash Flow Achieve above market growth in local currency 16-19 % Sustainable progression in operating cash flow generation 38 ROIC Above peer group average Objectives Overall objectives Serve markets with future prospects and attractive growth rate
Slide 38: Our strategy is built on five key pillars
Equity Story Clariant 2017 39 Focus on innovation through R&D Add value with sustainability Reposition the portfolio Intensify growth Increase profitability 1 2 3 4 5 Our strategy is built on five key pillars INNOVATION Understand our customer needs and offer joint R&D collaboration with the custome
Slide 39: Innovation & Sustainability
Innovation & Sustainability
Slide 40: Focus on innovation through R&D
Focus on innovation through R&D Equity Story Clariant 2017 41 Innovation figures ~ 1 100 6 500 3.5 % of 2016 group sales spent in R&D 206 m R&D spend in CHF m > 125 Employees in R&D (end of 2016) Patents Scientific collaborations Global R&D Centers 8 Technical Centers > 50 GLOBAL TRENDS as innovatio
Slide 41: Innovation@Clariant – The Innovation Chain
Equity Story Clariant 2017 42 Application Development Technical Services Marketing, Production R&D shaped along Technology Platforms Innovation@Clariant – The Innovation Chain Group Technology & Innovation Business AREAS Markets & Customers Engineering Intellectual Property Management New Business D
Slide 42: Targeting sustainable standards and solutions
Targeting sustainable standards and solutions Increasing customer and market awareness of and sensitivity to sustainability Striving for sustainable standards and supporting customers to create value by applying our expertise and knowledge in chemistry, technology and service enhancing customer’s su
Slide 43: Innovation in detergents
Innovation in detergents Translating customer needs into product solutions Equity Story Clariant 2017 44 Aesthetic monodose units Out of the wash products Less rinsing Less energy – wash at low temperature Less water – less rinsing Less waste – concentrates Fabric and colour maintenance Fresh scent
Slide 44: TexCare Polymers for laundry detergents
45 TexCare® Polymers for laundry detergents Multifunctional TexCare polymers prevent soil redeposition on fabrics for improved whiteness. Can also close performance gap at low washing temperatures in regular use via soil release effect Improved polymer pH stability for heavy duty liquid detergents S
Slide 45: TexCare Innovation: Application tests prove roll-up mechanism
TexCare® Innovation Application tests prove “roll-up” mechanism Equity Story Clariant 2017 46 Small beakers containing 200g of washing solution, steel balls, test samples Without SRP* With SRP* DIRTY MOTOR OIL TEST LINI TEST EQUIPMENT * SRP: soil-release polymers
Slide 46: Sustainability is an integral part of our strategy
Sustainability is an integral part of our strategy, business culture and how we operate Equity Story Clariant 2017 47 Our acknowledgements
Slide 47: Sustainability is an integral part of our strategy
, CLARIANT Sustainability is an integral part of our strategy, business culture and how we operate Our acknowledgements Dow Jones ROBECOSAM Sustainability Indices Sustainability Award In Collaboration with RobecoSAM «© Silver Class 2016 = EURONEXT EXCELLENCE Europe
Slide 48: Seven successive years of EBITDA margin growth
Seven successive years of EBITDA* margin growth Equity Story Clariant 2017 49 Enhanced and more resilient product portfolio due to continuous focus on innovation, sustainability, portfolio repositioning and operational efficiency Clariant Excellence achieved cumulated net benefits of CHF 613 m in th
Slide 49: Continuous Operating Cash Flow improvement
Continuous Operating Cash Flow improvement Equity Story Clariant 2017 50 Sustainable progression in operating cash flow generation as a result of a Continued EBITDA improvement Focus on net working capital management 3 step operating cash flow improvement process implemented in 2015 Significant 29 %
Slide 50: Dividend policy to increase or at least maintain absolute dividend
Dividend policy to increase or at least maintain absolute dividend in Swiss francs Equity Story Clariant 2017 51 Dividend in creased by an average of 8% p.a. in Swiss francs from 2012-2016 12.5% higher dividend in 2016 (to be distributed from capital contribution reserve which is exempt from Swiss w
Slide 51: Highly Experienced Management
Highly Experienced Management
Slide 52: The Executive Committee
The Executive Committee HARIOLF KOTTMANN, CEO Chairman of the Executive Committee Responsibilities: Corporate Planning & Strategy, Corporate Sustainability & Regulatory Affairs, Group Communications, Group Human Resources, Investor Relations, Group Legal, and Clariant Excellence with a focus on Peop
Slide 53: The Executive Committee
CLARIANT The Executive Committee Shalne HARIOLF KOTTMANN, BRITTA PATRICK JANY, CHRISTIAN CEO FUENFSTUECK CFO KOHLPAINTNER Chairman of the Member of the ‘Member of the ‘Member of the Executive Committee Executive Committee Executive Committee Executive Committee Responsibilities: Responsibilities: Re
Slide 54: What makes Clariant so special?
What makes Clariant so special? Equity Story Clariant 2017 55 We are a leading Specialty Chemical Company We serve markets with future prospects and above average growth rates by providing solutions to global challenges by supporting our customers in creating more value by focusing on the requiremen
Slide 55: Investor Relations Contacts
Investor Relations Contacts 56 Equity Story Clariant 2017 Anja Pomrehn Head of Investor Relations Phone +41 61 469 67 45 Mobile +41 79 618 19 82 E-mail anja.pomrehn@clariant.com Maria Ivek Investor Relations Officer Phone +41 61 469 62 92 Mobile +41 79 847 23 80 E-mail maria.ivek@clariant.com Sonja
Slide 56: Our iPad App
Download it here: iPad App: www.clariant.com/IRapp Our iPad App 57 Equity Story Clariant 2017
Slide 57: Our iPad App
CLARIANT Our iPad App a INVESTOR RELATIONS Download it here: iPad App: www.clariant.com/IRapp