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Huntsman and Vantico make everyone happy

Issuer: Huntsman
Size: $350 million
Type: 11% senior secured notes
Managers: Deutsche Bank, UBS


The restructuring and refinancing of global chemicals company Vantico, completed on June 30, marked the end of a five-month joust between distressed debt investors MatlinPatterson and Apollo Management for control of the company.

Frauman:"In takeovers like this, there really are no rules"

The tussle could signal an upsurge in contested takeovers in Europe where rival bidders buy into different levels of the target's debt. "In takeovers like this, there really are no rules," says David Frauman, a partner at Allen & Overy and Vantico's lead lawyer on its restructuring. "It is a question of how deep the buyers' pockets are and if their strategy is the right one."

Morgan Grenfell Private Equity (MGPE) created Vantico in June 2000 when it bought Ciba Speciality Chemicals' performance polymers division. MGPE's share interest was in a top company, Vantico Holding. Vantico Holding sold e150 million of Pay-in-Kind (PIK) notes to a group of 10 holders in a private placement.

Below Vantico Holding was Vantico Group, which issued e250 million of publicly held high-yield debt.

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