KINGSPORT, TN/ST. LOUIS, MO – Eastman Chemical Co. and Solutia Inc. have entered into a definitive agreement under which Eastman will acquire Solutia, a global leader in performance materials and specialty chemicals. The total transaction value of the deal is approximately $4.7 billion, including the assumption of Solutia’s debt. 

Eastman and Solutia share several key fundamentals, such as complementary technologies and business capabilities, a polymer science backbone, similar operating philosophies, and a high-performance culture. In addition, the overlap of key end-markets is expected to provide opportunities for growth. 

This acquisition is also a significant step in Eastman’s strategy to extend its global presence in emerging markets. In particular, it should significantly accelerate Eastman’s growth efforts and offer excellent growth opportunities in Asia Pacific. By leveraging infrastructure in the region, Eastman expects to have a compound annual growth rate in Asia Pacific approaching 10 percent for the next several years. 

The transaction, which was approved by the boards of directors of both companies, remains subject to approval by Solutia’s shareholders and receipt of required regulatory approvals as well as other customary closing conditions. The transaction is expected to close in mid-2012.