Wanhua gives up BorsodChem takeover battle

Hungary's BorsodChem has reached an agreement with China's Wanhua, allowing it a future as a minority shareholder but not to control the company.

According to portfolio.hu, it seems Wanhua has given up its intention to squeeze out owner Permira and become a majority owner of the Hungarian company.

"After three days of intensive negotiations, the management and the majority shareholders of Hungarian chemicals firm BorsodChem signed an agreement in principle with representatives of Wanhua Industrial, a China based holding, which controls Yantai Wanhua.

The parties also reached an agreement on BorsodChem’s debt restructuring plan, which enjoys a strong support by the senior lenders and the Hungarian government.

"This is a very important step for the financial restructuring of BorsodChem and the implementation of our growth plan", stated Wolfgang Büchele, CEO of BorsodChem after the negotiations.

"This result is good for BorsodChem, its customers, suppliers and the employees in particular", Büchele added. "But there is still a long way to go. Several questions remain unresolved for the time being and will be addressed only at a later stage. The delegates agreed on further negotiations in due course to discuss the open questions in a friendly and constructive manner."

The negotiations, which took place in Budapest, were attended by Wolfgang Büchele, representatives of the shareholders Permira and Vienna Capital Partners and Wanhua Industrial, including Chairman Jiansheng Ding.

Last week, in a meeting with senior lenders of BorsodChem the banks expressed their strong support of the current management of BorsodChem and their expectations that the current management continues to operate BorsodChem during the implementation of the growth plan.

The Permira Funds and Vienna Capital Partners (VCP) should remain majority shareholders and continue to exercise operational control, the banks stated."