US-based firms, Solstice Advanced Materials and Element Solutions, have mutually agreed to terminate their previously announced merger agreement.
As part of the deal Solstice planned to acquire Element in a cash-and-stock transaction valued at approximately $US14.5 billion. Both parties are not required to pay a termination fee as a result of the decision.
Solstice board of directors chair, Dr. Rajeev Gautam, said the decision was made following conversations with shareholders and discussions between the parties.
“Both Boards unanimously believe that it is in the best interests of our respective shareholders, employees and customers to terminate the merger agreement,” he said.
“We value the feedback received from shareholders in connection with the Element agreement, including their excitement about Solstice's strategy and growth trajectory as an independent company.
“The Board is confident that Solstice's strategic plan and leadership team will deliver substantial value for Solstice shareholders."
Solstice president & CEO, David Sewell said the company moves ahead from a position of strength.
"While we viewed the Element acquisition as an opportunity to accelerate our strategy, we have great confidence in our strategic plan and respect our shareholders' views," Sewell said.
"As demonstrated by our reported results and recently increased guidance, which we are reaffirming today, the Solstice team is executing well and with discipline across our operations.
“Solstice benefits from highly differentiated technology and a business aligned with powerful secular growth trends driven by AI, data centres, nuclear energy, thermal management and semiconductor manufacturing."
Element Solutions chair, Ian G.H. Ashken, said although the proposed transaction was compelling, both companies’ boards concluded they could serve their respective shareholders better as standalone companies at this time.
Element Solutions CEO, Benjamin Gliklich, said going forward the company will continue to executive their strategy focused on operational excellence, prudent capital allocation and developing the best, most entrepreneurial team in the industry.
“Our growth trajectory remains compelling, and the momentum in our business continues unabated and in-line with our guidance. With a healthy balance sheet and exciting new product introductions continuing to gain traction, we look forward to the significant opportunities ahead for Element Solutions and our businesses,” he said.