MOSCOW (MRC) -- Axiall Corp, a U.S. chemical and building products maker, said it had rejected Westlake Chemical Corp's USD1.4 billion cash-and-stock offer, dismissing it as an attempt to scoop up its vinyls assets on the cheap, said Reuters.
Westlake, a Houston-based manufacturer and supplier of petrochemicals, polymers and building products, had argued that the combined company would be more diversified and have a stronger financial profile than Axiall on its own.
"We believe that Westlake's proposal is an opportunistic attempt to take advantage of challenging public equity market conditions and significantly undervalues Axiall's assets and its long-term prospects," Axiall Chief Executive Officer Timothy Mann said in a statement.
Westlake's proposal came less than two months after chemical titans DuPont and Dow Chemical Co agreed to a USD120 billion mega merger seen as a trigger for more consolidation in the chemical industry.
Axiall said in its rejection letter on Friday that it was taking other steps to increase shareholder value, including acknowledging the sale of its building products business. That business could fetch as much as USD800 million, according to a person familiar with the matter who requested anonymity discussing confidential financial details.
"In this challenging environment, we believe Axiall's unwillingness to even discuss our compelling proposal exposes its shareholders to significant risk and uncertainty," Westlake Chief Executive Officer Albert Chao said in a statement.
Axiall is a chemical company formed in 2012 from the chemical assets of PPG and Georgia Gulf. The PPG products are primarily chlor-alkali. The combined companies will be the third largest producer of chlor-alkali in the US after Dow Chemical and Occidental. PPG will own 50.5% of the combined companies. The company is headquartered in Atlanta, GA.
Westlake Chemical Corporation is a U.S. manufacturer and supplier of petrochemicals and polymers, headquartered in Houston, Texas. The range of company's products includes ethylene, polyethylene, styrene, propylene, caustics, polyvinyl chloride and plastic products. Westlake is one of the major ethylene producers in the US and its Calvert City operation is a large integrated PVC site.
MRC