Two Swiss chemical giants, Clariant Ag and Ciba Specialty Chemicals AG, said Monday they are teaming up to form the world's biggest specialty-chemical business in a deal worth $6.2 billion.
The two companies also made it clear they're interested in a possible future listing on Wall Street, as they're adopting Generally Accepted Accounting Principals (GAAP) - a pre-requisite for a U.S. listing. In the merger announcement, Clariant and Ciba said this will "enable a possible future listing in the U.S."
The Swiss companies said the merger will be earnings-enhancing from 2000, and that annual savings will total more than 600 million Swiss francs by the year 2001 and involve the loss of 3,000 jobs - or 5 percent of the combined workforce - worldwide. The company will be listed under the name Clariant and use Ciba's butterfly symbol.
Together, the two will have combined sales of $13.29 billion in more than 120 countries.
Rolf W. Schweizer, chairman and president of Clariant, said in a statement: "This merger is the unique opportunity to form a Swiss-based global leader in specialty chemicals which will enjoy sustainable, above-average growth, with superior profitability."
The merger agreement, scheduled for completion in December, still needs shareholder and regulatory approval. Clariant shareholders will receive 5.35 registered shares of the new company in exchange for each share of Clairiant, while Ciba shareholders will get 1 registered share of the new company in exchange for each Ciba Specialty chemicals share. The group will have registered shares with nominal share value of 10 Swiss francs each.
Written By Suzanne Miller