Dallas-based Rexene Corp. has, for the second time in two weeks, rejected a $461.5 million takeover offer from Huntsman Corp., the Salt Lake City-based petrochemical company.
Rexene's board of directors on Monday unanimously rejected the increased bid, saying that shareholders would be better off not taking the $15 per share offer from Huntsman, the world's largest privately owned chemical company.Huntsman had described the latest offer as a last attempt to complete a deal with the Rexene board. The company implied that its next step will be to seek approval from shareholders directly.
In addition to buying Rexene's stock, Huntsman would assume its $175 million debt.
On July 22, Rexene rejected a $14 per share offer by Huntsman. Rexene stock, which was trading at about $9 per share just before the first offer, closed Monday at $13.875, up 12.5 cents.
The decision by Rexene's board to reject the offer is "clearly harmful to the best interest of Rexene's shareholders," said Jon M. Huntsman, chairman and chief executive officer.
"It's a matter of simple arithmetic," said Huntsman. "Would Rexene's shareholders rather have $9 or $15? How unfortunate for Rexene shareholders that Chairman Andrew J. Smith and his board refused to meet with us. Obviously, they are not concerned with shareholder value."
Huntsman cited Rexene's lower earnings this year, adding, "The chemical industry is just beginning a major cyclical downturn in most of Rexene's products."
Huntsman, with $4.5 billion in sales, is several times larger than Rexene, which posted sales of $615 million in 1995.