Germany’s Brenntag ends takeover talks with U.S. rival Univar
BERLIN — German chemicals distributor Brenntag said on Monday it is ending talks with smaller U.S. rival Univar Solutions on a possible takeover, weeks after activist investor PrimeStone called on the company to consider a break-up instead.
Shares in the Essen, Germany-based Brenntag slipped sharply after it announced in November that it was discussing a bid, which it said would help it expand in the United States.
“Brenntag SE has decided today it is no longer proceeding with those discussions,” the company said in a statement on Monday evening, giving no reason for the decision.
Univar confirmed late Monday that Brenntag has ended its talks with the company about a potential transaction.
The company and its board of directors will continue discussions relating to other indications of interest that have been received with respect to a potential transaction, Univar said in a statement.
On Dec. 20, PrimeStone disclosed it owned 2% of Brenntag’s shares and urged the company to drop the talks, which it said smacked of risky empire-building with attendant anti-trust challenges that would lower the companies’ gross profits.
The activist investor, which two years ago pushed for cost cuts at British wealth manager St. James’s Place, urged the company to buy back shares and prepare to split up into two separate companies.
Brenntag combines units that engage in the modestly margined business of transporting chemicals with more specialist and faster-growing units that deal with industries like pharmaceuticals and nutrition. (Reporting by Akanksha Khushi in Bengaluru and Thomas Escritt in Berlin; additional reporting by Rhea Binoy in Bengaluru; Editing by Grant McCool and Himani Sarkar)
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