Westlake Chemical to buy Axiall Corporation
The deal will create the second-largest PVC producer in North America.
Westlake Chemical Corporation has agreed to buy Axiall Corporation for about US$2.33 billion, in a deal that, once completed, will form the second-largest PVC producer in North America.
The transaction, which has been unanimously approved by both companies’ boards of directors, is scheduled to be completed by the fourth quarter of 2016.
The acquisition will combine two major North American PVC building product manufacturers: Axiall’s Royal Group Inc. subsidiary – which is headquartered in Woodbridge, Ont. – and Westlake’s North American Pipe Corp.
Houston, Tex.-based Westlake first offered Axiall US$1.4 billion in January. That offer, which was worth about US$2.9 billion including debt, was rejected by Axiall as too low.
Axiall rejected another bid shortly after the first offer and then sought other buyers. Meanwhile, Westlake tried to replace members of Axiall’s board.
Headquartered in Atlanta, Ga., Axiall makes chemicals that are used in paper, soap, aluminum and other products. It also makes windows, doors and other building products.
Westlake makes chemicals used in food packaging, trash bags and other products.
“We believe this strategic combination will drive significant value for our customers and business partners as we create a North American chlorovinyls leader with a highly integrated chain, diverse product portfolio and a globally competitive cost structure,” Axiall president and CEO Timothy Mann Jr. said in a news release.