Business Blog: Hoover’s Business Insight Zone

The thing about covering an industry like chemicals* is that pretty much the only people who know anything about the chemical industry already work within it. And so when stuff happens with chemical companies, press reports tend to be short on actual industry news and long on stuff that’s easier to get a handle on: high finance and/or big personalities.

Such is the case with Hexion Specialty Chemicals and its $10 billion counter offer for Huntsman Corporation, which came a week after global petrochemicals maker Basell had agreed to buy Huntsman for $9 billion. Now, you could talk about a maker of commodity chemicals (Basell) trying to buy a company that is in the process of getting out of the commodity chemicals business (Huntsman) and how another company that’s already a specialty chemicals heavyweight is looking to get even bigger (Hexion). And, perhaps, what does it mean when a traditional petrochemicals giant is getting out of the petrochemicals business altogether? (Huntsman, which made its name making those Styrofoam containers used by McDonald’s in the 1970s, has sold its base chemicals and polymers business.)

Sure, you could talk about all that. But wouldn’t it be more exciting to talk about a catfight between private equity goliath Apollo Management (which owns 90% of Hexion) and Russian oligarch Len Blavatnik (who owns Access Industries, which owns Basell)? Or, maybe, it’d be fun to talk at even more length about the private equity game rather than the chemicals business. Wouldn’t it?

Yes, yes it would.

*Yes, in addition to covering the Metals & Mining sector, I am also responsible for Hoover’s coverage of chemical companies. That’s right, the ladies love me for my industry knowledge. Believe it.