By Colin Kellaher
Solstice Advanced Materials has struck a deal to buy specialty chemicals maker Element Solutions for more than $12 billion in cash and stock.
Solstice on Monday said the deal values Element at about $50.10 a share, a roughly 15% premium to Thursday's closing price of $43.64 for the Miami Beach, Fla., company.
Solstice, a Morris Plains, N.J., maker of refrigerants and advanced materials that was recently spun out of Honeywell, said it will pay $10 cash and issue half of a share, worth about $40.10 based on Thursday's closing price, for each share of Element.
The transaction, slated to close in the first half of 2027, is valued at about $14.5 billion, including the assumption of debt and will result in Element shareholders owning roughly 44% of the combined company, which would have generated sales of $6.8 billion last year.
Element shares were recently down 0.8% at $44.00 in premarket trading, while shares of Solstice slid 8.3% to $73.53.
Solstice said the transaction accelerates its strategy to build an advanced materials platform with increased exposure to high-growth electronics, AI infrastructure, thermal management, data-center cooling applications and other attractive specialty markets.
Solstice said Element's electronics, formulation and technical service capabilities complement its strengths in chemistry, application development, refrigerant application solutions ad high-performance materials.
"Overall, we believe the combined company will be very well-positioned to benefit from generational tailwinds in high-growth end markets," said David Sewell, Solstice's president and chief executive.
Solstice said it will use cash on hand and $4.7 billion in bridge financing from Goldman Sachs to fund the cash portion of the transaction, adding that it remains focused on maintaining a consistently strong balance sheet.
Write to Colin Kellaher at colin.kellaher@wsj.com