Kratonperfor, a large SBC manufacturer, will renegotiate the terms of the merger and acquisition, The acquisition will allow Li Changrong to hold 50% of Kraton's shares
the terms of the transaction are expected to change due to the poor performance of styrene block copolymers in the first half of the year by Li Changrong, who is headquartered in Taipei, Taiwan. The pre tax profit of this business in the first half of the year decreased by 80% to less than US $3million, due to slower demand growth and overcapacity (mainly in China)
Kevin Fogarty, President and CEO of Kraton, headquartered in Houston, USA, discussed these results at the press conference on June 24, saying that Kraton's estimate of Li Changrong's adjusted pre tax profit may be delayed for two years. He added that with the recovery of China's GDP growth, Kraton expected these factors to ease in the second half of 2014
this disclosure made the share price of Kraton fall by 14% at the close of the day, from more than $25 to less than $22. Therefore, the board of directors of Kraton announced on June 30, The proposal to approve the transaction previously announced by "high molecular materials while saving energy" to shareholders will be withdrawn. Li Changrong must respond within 5 business days from that date.
however, officials of the two companies said that they still believed that the merger would occur.
gene shields, director of investor relations of Kraton, said in an interview on July 2: "Both parties still hope to carry out this transaction. However, the demand for digital display is relatively small, and the terms may be changed."
shields added that Kraton had not submitted the revised document, which would set a date for shareholder voting. The date of the vote now depends on the length of negotiations between Kraton and Li Changrong
before applying antirust oil The Taipei Times reported on July 2 that an official of Li Changrong company said that he would negotiate with Kraton and it was possible to modify the terms of the transaction. Abbypan, a spokeswoman for Li Changrong company, told the newspaper that the company would try to learn more about Kraton's concerns and respond in the interests of Li Changrong's shareholders
the combined company is expected to have annual sales of more than $2billion. SBC is the largest of Li Changrong's seven business departments, with sales of $612million in the fiscal year ended September 30
roberteller, an industry consultant and President of robertellerassociates in the United States, said that he was not surprised by the problems encountered in the transaction of cetem Li Changrong because of the overcapacity of SBC in Asia"
eller said," the deal is still worth negotiating. But there are still many problems to be solved. "
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