Celanese parent signs agreement to acquire Acetex Corp.

Oct. 27, 2004
Blackstone Crystal Holdings Capital Partners IV Ltd. (BCP Crystal) and Acetex Corp. have signed an agreement for BCP Crystal to acquire Acetex in a transaction valued at approximately CDN$600 million (US$492 million)...

DALLAS & VANCOUVER, Canada, Oct. 27, 2004 (BUSINESS WIRE) -- Blackstone Crystal Holdings Capital Partners IV Ltd. (BCP Crystal) and Acetex Corp. have signed an agreement for BCP Crystal to acquire Acetex in a transaction valued at approximately CDN$600 million (US$492 million).

Under the terms of the agreement, BCP Crystal will acquire all of the issued and outstanding common shares of Acetex for CDN$9 (US$7.38) cash per share. Acetex option and warrant holders are eligible to receive CDN$9 cash, less the exercise price of each option or warrant.

Acetex will be operated as part of BCP Crystal's global Celanese chemicals business.

"The acquisition of Acetex is an important part of our overall efforts to accelerate growth and productivity at Celanese," said David Weidman, designated CEO of the holding company for Celanese. "It is consistent with our commitment to provide a highly reliable, cost-efficient supply to the global acetyls market. We have been impressed with the Acetex team and look forward to serving our customers together in the near future."

Brooke N. Wade, Acetex chairman and CEO, noted, "With the sale, our long-term shareholders receive a premium valuation for their investments in Acetex. Celanese brings to the table a globally recognized brand name, proprietary technology and expertise that will strengthen our acetyls operations. Those qualities also make Celanese an ideal partner for the Saudi Arabia acetyls project and one that appreciates its potential value."

Acetyl products, which include acetic acid, vinyl acetate monomer and others, are the building block chemicals used to produce such products as paints, coatings, adhesives, and textiles.

The offer to acquire approximately 35.4 million fully diluted shares implies a total value for the equity of Acetex of CDN$318 million (US$261 million). The per share offer price represents a 26% premium to the average closing price in the 30 days prior to Acetex's Sept. 17 announcement that it was in discussions regarding a potential transaction. Acetex net financial debt of approximately CDN$282 million (US$231 million) will be assumed in the transaction. The acquisition will be financed through an amendment and expansion of the senior credit facility of a BCP Crystal subsidiary.

A proxy circular on the agreement will be mailed to shareholders in December with a meeting in January to approve the arrangement. UBS Securities Canada Inc. acted as lead financial advisor to Acetex in on the transaction, with additional input from GMP Securities Ltd. Lehman Brothers Inc. acted as financial advisor to BCP Crystal.
BCP Crystal, which is incorporated in the Cayman Islands, is controlled by a group of investment funds, which are advised by The Blackstone Group, a leading global investment firm. Earlier this year, a subsidiary of BCP Crystal successfully completed a voluntary public tender offer for Celanese. Celanese holds worldwide leading positions in its key products and world-class process technology. Its portfolio consists of four main businesses: Chemical Products, Acetate Products, Technical Polymers Ticona and Performance Products. In 2003, Celanese generated sales of around US$4.6 billion with about 9,500 employees. It has 24 production plants and six research centers in 10 countries mainly in North America, Europe and Asia.

About Acetex
Acetex with 2003 revenues of US$484 million and about 900 employees worldwide has two primary businesses -- its Acetyls Business and the Specialty Polymers and Films Business. The Acetyls business, based in Europe, produces acetic acid, polyvinyl alcohol and vinyl acetate monomer. These chemicals and their derivatives are used in a wide range of applications in the automotive, construction, packaging, pharmaceutical and textile industries. Specialty polymers developed and manufactured by Acetex are used in the manufacture of a variety of plastics products, including packaging and laminating products, auto parts, adhesives and medical products. The Films Business focuses on products for the agricultural, horticultural and construction industries. The company is based in Vancouver, Canada, and operates production facilities in France, Spain, and Canada, and sells to customers primarily in Europe, the United States, and Canada.

Acetex also has announced plans for a joint venture for the construction and operation of a US$1 billion integrated world-scale acetyls facility in Al Jubail, Saudi Arabia. It's proceeding, in conjunction with its partners, with the front-end engineering design for the construction of the plant. The partner is National Petrochemical Industrialization Co. (TASNEE). The project will benefit from favorable natural gas supply as well as from Acetex's proprietary integration technology. Acetex will own 50% of the acetyls company (acetic acid and VAM) and 25% of the methanol company and expects to enter long-term methanol supply agreements with the joint venture to cover its methanol requirements in Saudi Arabia and Europe.


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