The U.S. subsidiary of Rotterdam, Netherlands-based chemical distribution company Univar N.V. put the kibosh on a possible bidding war for Chemcentral by agreeing to revised merger terms under which it will acquire 100 percent of Chemcentral shares for $650 million, up $50 million from its initial proposal. The revised terms, announced March 21, also prohibit Chemcentral from soliciting or considering other proposals to acquire it, and require Chemcentral to discontinue any further acquisition discussions with Brenntag Holding GmbH.
According to Univar, certain senior officers and the board of directors of Chemcentral have committed to vote their shares in favor of a merger with Univar and against other proposals. Completion of the merger remains conditional upon regulatory approvals and approval by Chemcentral shareholders, and is expected to close in April 2007. Chemcentral is a privately held company based near Chicago.
On March 12 Univar had announced that its U.S. subsidiary entered into an agreement to acquire all the shares of Chemcentral Corp. for $600 million in cash, including assumed debt, uniting two chemical distributors who work with products involved in lubricants, lubricant additives and metalworking fluids.
On March 19 Univar announced that Chemcentral received a competing, non-binding $700 million acquisition proposal from Brenntag Holding GmbH, an industrial and specialty chemicals distributor based in Germany, which appeared to open the possibility of a bidding war for Chemcentral.
A Chemcentral official March 20 told Lube Report the Brenntag offer represented only an expression of interest, not a definitive offer, and emphasized that Chemcentral was proceeding as planned with its merger plans with Univar.