Olin and Huntsman Merge to Form US$12.5bn Chemicals Firm

Two major chemical manufacturers have agreed to combine operations in a deal that would create a business with US$12.5bn in annual revenue. Olin and Huntsman say the transaction represents a merger of equals.

The combined entity will operate under the name OlinHuntsman Corporation. Olin manufactures specialised chemicals and owns Winchester Ammunition, while Huntsman produces chemicals across multiple categories.

According to McKinsey, chemical companies face mounting pressure from regulations, energy costs and workforce transitions. The consulting firm noted that after years of outperforming broader markets, the chemicals industry's returns now lag behind.

Scale and market positioning

The merger could show how consolidation creates competitive advantages during industry pressure. Huntsman says the combined company will benefit from enhanced scale, scope and expanded chlorine optionality.

Peter Huntsman, Chairman, President and Chief Executive Officer of Huntsman, says: "The opportunities this merger creates enable us to generate greater value for our shareholders, deliver exceptional service and products for our customers and provide greater stability and opportunities for our associates."

Peter adds: "This merger of equals takes two great companies and creates a much stronger global leader."

Winchester will continue to operate as a business within OlinHuntsman. The ammunition division supplies sporting, law enforcement and military customers.

Geographic and operational footprint

According to Huntsman, the company operates more than 55 manufacturing, research and development and operations facilities in 25 countries. The business employs roughly 6,000 associates.

Olin employs 7,700 professionals in more than 15 countries across three business segments. These include Olin Chlor Alkali Products & Vinyls, Olin Epoxy and Winchester Ammunition.

Olin operates in more than 25 locations in the US and has production sites in Latin America. The company maintains four manufacturing sites across Europe, the Middle East, Africa and India regions, plus a manufacturing facility in China.

The combined company would operate with roughly 13,700 employees across dozens of facilities. Together the two businesses would generate approximately US$12.5bn in 2025 revenue on a combined company basis.

Industry performance and challenges

According to McKinsey, the chemicals industry generated returns above broader capital markets for most of the past 20 years. The consulting firm noted that after reaching record heights during the COVID-19 pandemic, the industry may be entering a new era.

Global indexes have increased 24% per year since late 2022, according to McKinsey. Chemicals stocks grew less than 2% per year over the same period.

Chemical companies face new regulations, overbuilt capacity, high energy prices, regionalisation, inflation and demographic shifts. The closure of the Strait of Hormuz has also disrupted the global flow of oil and petrochemicals.

Peter says: "As our industry continues to globalise, we compete more today against countries, than companies, trade policies and global supply chains than ever before."

Product portfolios and integration

Olin manufactures small calibre ammunition and operates as a global chlor alkali producer. The company is a North American seller of chlorine, bleach and hydrochloric acid.

Huntsman is a producer of polyurethanes, advanced materials and performance products. The combination will integrate Olin's manufacturing and feedstock capabilities, including chlorine and caustic soda, with Huntsman's downstream products and formulation expertise.

Ken Lane, President and Chief Executive Officer of Olin, will lead the combined company. Ken says: "This combination provides a compelling opportunity for Olin and Huntsman to create a more resilient and value-focused chemicals company anchored in North America."

Ken adds: "Huntsman has built an impressive portfolio of polyurethane systems, formulation technologies and advanced materials serving technical, application-driven end markets."

Regional positioning and strategy

According to Huntsman, the two companies' portfolios and enhanced geographic footprint will position OlinHuntsman to capitalise on regional sector dynamics. This includes a presence in the US Gulf Coast.

The combined business will maintain operations in Europe and Asia. Huntsman says this will enable OlinHuntsman to better serve customers across key markets.

Ken says: "I'm excited by the opportunity to lead OlinHuntsman and deliver long-term value for our shareholders, customers, employees and communities."