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Huntsman Corporation (HUN - Free Report) said that it is retaining the Textile Effects business and has excluded it from its planned spin-off of the Pigments and Additives division. The chemical maker also noted that the name of its planned spin-off will be “Venator Materials Corporation”.
Venator shares are expected to trade on the NYSE under the ticker “VNTR” following the distribution to Huntsman's shareholders, which has been targeted for second-quarter 2017.
Improvement in titanium dioxide (TiO2) pricing and the identification of business improvement opportunities (representing over $75 million in annual EBITDA) are expected to reinforce the financial strength of Venator's business. The $75 million in business improvements are incremental to current earnings and are anticipated to be completed by end-2018.
Recovery in TiO2 pricing coupled with the business improvements that are incremental to current earnings are expected to more than offset the free cash flow that Venator would have received from the Textile Effects business.
Huntsman is moving forward with the planned spin-off of the Pigments and Additives unit. The completion of the spin-off is subject to the satisfaction or waiver of a number of conditions that include the registration statement on Form 10 for Venator’s common stock being declared effective by the U.S. Securities and Exchange Commission and other specific conditions described in the Form 10.
Huntsman has significantly outperformed the Zacks categorized Chemicals-Diversified industry over a year, partly attributable to its forecast-topping earnings performance in the trailing four quarters. The company’s shares have gained around 147% over this period, compared with roughly 35% gain recorded by the industry.
Huntsman continues to improve its free cash flow generation and remains focused on expanding its downstream differentiated businesses. The company also remains committed to de-leverage its balance sheet. It repaid around $550 million of debt during 2016.
Huntsman, in late 2016, wrapped up the sale of its European surfactants business to Innospec Inc. for an enterprise value of $225 million. The divestment is a key step in the company's strategic transformation of its Performance Products business. Huntsman used the proceeds from the sale along with its existing cash for the early repayment of $260 million of debt.
Huntsman currently carries a Zacks Rank #3 (Hold).
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Huntsman Retains Textile Business, Names Spin-off Venator
Huntsman Corporation (HUN - Free Report) said that it is retaining the Textile Effects business and has excluded it from its planned spin-off of the Pigments and Additives division. The chemical maker also noted that the name of its planned spin-off will be “Venator Materials Corporation”.
Venator shares are expected to trade on the NYSE under the ticker “VNTR” following the distribution to Huntsman's shareholders, which has been targeted for second-quarter 2017.
Improvement in titanium dioxide (TiO2) pricing and the identification of business improvement opportunities (representing over $75 million in annual EBITDA) are expected to reinforce the financial strength of Venator's business. The $75 million in business improvements are incremental to current earnings and are anticipated to be completed by end-2018.
Recovery in TiO2 pricing coupled with the business improvements that are incremental to current earnings are expected to more than offset the free cash flow that Venator would have received from the Textile Effects business.
Huntsman is moving forward with the planned spin-off of the Pigments and Additives unit. The completion of the spin-off is subject to the satisfaction or waiver of a number of conditions that include the registration statement on Form 10 for Venator’s common stock being declared effective by the U.S. Securities and Exchange Commission and other specific conditions described in the Form 10.
Huntsman has significantly outperformed the Zacks categorized Chemicals-Diversified industry over a year, partly attributable to its forecast-topping earnings performance in the trailing four quarters. The company’s shares have gained around 147% over this period, compared with roughly 35% gain recorded by the industry.
Huntsman continues to improve its free cash flow generation and remains focused on expanding its downstream differentiated businesses. The company also remains committed to de-leverage its balance sheet. It repaid around $550 million of debt during 2016.
Huntsman, in late 2016, wrapped up the sale of its European surfactants business to Innospec Inc. for an enterprise value of $225 million. The divestment is a key step in the company's strategic transformation of its Performance Products business. Huntsman used the proceeds from the sale along with its existing cash for the early repayment of $260 million of debt.
Huntsman currently carries a Zacks Rank #3 (Hold).
Huntsman Corp. Price
Huntsman Corp. Price | Huntsman Corp. Quote
Stocks to Consider
Better-ranked companies in the chemical space include BASF SE (BASFY - Free Report) , Methanex Corporation (MEOH - Free Report) and Kronos Worldwide, Inc. (KRO - Free Report) , all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
BASF has an expected long-term growth of 7.7%.
Methanex has an expected long-term growth of 15%.
Kronos has an expected long-term growth of 5%.
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In addition to the recommendations that are available to the public on our website, how would you like to follow all Zacks' private buys and sells in real time?
Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Starting today, for the next month, you can have unrestricted access. Click here for Zacks' private trades >>