Ashland To Buy Hercules For $3.3B

Covington, KY (AHN) - Chemical company Ashland Inc. announced Friday it will buy Wilmington, Delaware-based specialty chemical firm Hercules Inc. for $3.3 billion in a cash and stock deal, including the assumption of debt.

Ashland will pay $23.01 per Hercules share at $18.60 cash and 0.093 of a share of Ashland common stock- a buyout premium of about 38 percent over Thursday's closing.

The transaction is estimated at $2.6 billion based on 113.1 million outstanding shares as of April 25.

According to MarketWatch, Ashland chairman and CEO Jim O'Brien said the acquisition further establishes the company's core businesses in specialty chemicals for different types of additives, paper and pulp, water technologies and resins.

Ashland also targets cost savings of at least $50 million in the third year and the improvement of cash flow.