Swiss specialty chemicals maker Clariant and U.S. group Huntsman have abandoned their $20 billion merger, notching a win for activist investors who fought against the deal for months on the grounds it would destroy shareholder value. Ciara Lee reports.
The chemistry just wasn't there. Or rather, the support wasn't. Swiss specialty chemicals maker Clariant and U.S. group Huntsman have abandoned their $20 billion merger It's a big win for activist investors who fought against the deal for months Saying it would destroy shareholder value. White Tale, the investment vehicle of hedge fund manager Keith Meister and New York City-based fund 40 North, reportedly increased its Clariant stake to more than 20 percent, earlier this week.. White Tale's rising stake, coupled with Clariant shareholders who came out against the deal, left the Swiss company doubtful the deal would go through. The revolt comes amid a wave of investor activism in Switzerland, where Credit Suisse is under attack and Nestle also faces demands for change. (SOUNDBITE) (English) CHARLES STANLEY, CHIEF INVESTMENT COMMENTATOR, GARRY WHITE, SAYING: "Opposition from not wanting to take on a lot of debt from another company at this part of the cycle, so it isn't really that surprising the shareholders would be upset about it. We're seeing you know shareholder activism is now starting to become more of a theme in markets. And I'm not surprised that this deal has fallen apart." Clariant shares pared early losses to trade down 1.7 percent on Friday morning. Both have agreed to forego breakup fees. Clariant and Huntsman struck the deal in May would have created the world's second-biggest specialty chemicals firm.