Filed by Millennium Chemicals Inc.
Pursuant to Rule 425 under the Securities Act of 1933 and
Deemed Filed Pursuant to Rule 14a-6 under the Securities Exchange Act of 1934
Subject Company: Millennium Chemicals Inc.
Form S-4 Registration Statement File No.: 333-114877
Additional Information:
In connection with the proposed transaction, Lyondell and Millennium have filed relevant materials with the SEC, including Lyondell’s Amendment No. 3 to its registration statement on Form S-4 which contains a preliminary joint proxy statement/prospectus regarding the proposed transaction between Lyondell and Millennium, which was filed on September 30, 2004. The definitive joint proxy statement/prospectus was filed with the SEC on October 15, 2004 and will be sent to holders of Lyondell’s and Millennium’s common stock. Investors and security holders are urged to read the definitive joint proxy statement/prospectus and any other relevant documents filed or that will be filed with the SEC because they contain, or will contain, important information. Investors and security holders may obtain a free copy of the definitive joint proxy statement/prospectus and other documents filed by Lyondell and Millennium with the SEC at the SEC’s web site at www.sec.gov. The definitive joint proxy statement/prospectus and the other documents filed by Millennium may also be obtained free from Millennium by calling Millennium’s Investor Relations department at 410-229-8113.
Forward-Looking Statements:
These materials contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about the benefits of the proposed transaction between Lyondell Chemical Company (“Lyondell”) and Millennium Chemicals Inc. (“Millennium”) including Millennium’s plans, objectives, expectations and intentions and other statements that are not historical facts. Such statements are based upon the current beliefs and expectations of Millennium’s management and are subject to significant risks and uncertainties. Actual results may differ materially from those set forth in the forward-looking statements. The following factors, among others, could affect the proposed transaction and the anticipated results: approval by Lyondell’s and Millennium’s respective shareholders and the parties’ ability to achieve expected synergies in the transaction within the expected timeframes or at all. Additional factors that could cause Millennium’s results to differ materially from those described in the forward-looking statements can be found in Exhibit 99.1 to Millennium’s Annual Report on Form 10-K for the year ended December 31, 2003, which was filed with the SEC on March 12, 2004, Exhibit 99.1 to Millennium’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2004, which was filed with the SEC on May 14, 2004 and the definitive joint proxy statement/prospectus. Millennium disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise.
This filing contains slides utilized in presentations to customers of Millennium Chemicals Inc. These materials are being filed pursuant to Rule 425 under the Securities Act of 1933.
Millennium—Lyondell Business Combination Update Q4 2004
These materials contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about the benefits of the proposed transaction between Lyondell Chemical Company (“Lyondell”) and Millennium Chemicals Inc. (“Millennium”) including Millennium’s plans, objectives, expectations and intentions and other statements that are not historical facts. Such statements are based upon the current beliefs and expectations of Millennium’s management and are subject to significant risks and uncertainties. Actual results may differ materially from those set forth in the forward-looking statements. The following factors, among others, could affect the proposed transaction and the anticipated results: approval by Lyondell’s and Millennium’s respective shareholders and the parties’ ability to achieve expected synergies in the transaction within the expected timeframes or at all. Additional factors that could cause Millennium’s results to differ materially from those described in the forward-looking statements can be found in Exhibit 99.1 to Millennium’s Annual Report on Form 10-K for the year ended December 31, 2003, which was filed with the SEC on March 12, 2004, Exhibit 99.1 to Millennium’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2004, which was filed with the SEC on May 14, 2004 and the definitive joint proxy statement/prospectus. Millennium disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise.
In addition, in connection with the proposed transaction, Lyondell and Millennium have filed relevant materials with the SEC, including Lyondell’s Amendment No. 3 to its registration statement on Form S-4 which contains a preliminary joint proxy statement/prospectus regarding the proposed transaction between Lyondell and Millennium, which was filed on September 30, 2004. The definitive joint proxy statement/prospectus was filed with the SEC on October 15, 2004 and will be sent to holders of Lyondell’s and Millennium’s common stock. Investors and security holders are urged to read the definitive joint proxy statement/prospectus and any other relevant documents filed or that will be filed with the SEC because they contain, or will contain, important information. Investors and security holders may obtain a free copy of the definitive joint proxy statement/prospectus and other documents filed by Lyondell and Millennium with the SEC at the SEC’s web site at www.sec.gov. The definitive joint proxy statement/prospectus and the other documents filed by Millennium may also be obtained free from Millennium by calling Millennium’s Investor Relations department at 410-229-8113.
The respective executive officers and directors of Lyondell and Millennium and other persons may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information regarding Lyondell’s executive officers and directors is available in the proxy statement filed with the SEC by Lyondell on March 16, 2004 and in the definitive joint proxy statement/prospectus, and information regarding Millennium’s directors and its executive officers is available in Millennium’s Amendment No. 1 to its Annual Report on Form 10-K for the year ended December 31, 2003, which was filed with the SEC on April 27, 2004, and in the definitive joint proxy statement/prospectus. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, are contained in the definitive joint proxy statement/prospectus and may be contained in other relevant materials filed with the SEC, as they become available.
BUSINESS COMBINATION UPDATE
Millennium proposes to combine with Lyondell in a stock-for-stock transaction
Creates the world’s seventh-largest, independent chemical company, based on chemical sales; and North America’s third-largest independent, publicly traded chemical company
Leading integrated commodity and intermediates chemical businesses with leadership positions across range of market segments
$14.8 billion in 2003 pro forma combined enterprise revenues
- Wholly owned revenues of over $11 billion
- Combined market cap of over $5 billion
Approximately 10,000 employees on 5 continents in 17 countries
SIGNIFICANT MARKET POSITIONS
1st Propylene oxide globally
2nd Ethylene and propylene in North America
2nd TiO2 globally
2nd Acetic acid and VAM in North America
3rd Polyethylene (HDPE & LDPE) in North America
58.75% stake in one of largest extra heavy crude refineries in North America
COMBINED 2003 SALES (Pro Forma)
Millennium + Proportionate Share of JV Sales $3.6 B
Equistar 52%
TiO2 33%
Specialty Chemicals 3%
Acetyls 12%
LCR 23%
IC&D 35%
Lyondell + Proportionate Share of JV Sales $10.9 B
Equistar 42%
Consolidated Lyondell 2003 Sales (pro forma) $11.4 B1
TiO2 10%
Acetyls 4%
Specialty Chemicals 1%
IC&D 33%
Equistar 52%
1Excluding proportionate share of LYONDELL-CITGO Refining
RATIONALE FOR THE BUSINESS COMBINATION
Key benefits
Greater portfolio diversity
Increased global footprint
Consolidated ownership of Equistar
Greater scale provides greater access to capital and other resources
Opportunity for operational synergies
EXPECTED COMPANY STRUCTURE AND TIMING
Structure
Combined company will be named “Lyondell”
• Millennium continues as Millennium Chemicals, a Lyondell company
Dan Smith will continue as CEO upon the closing of the business combination
Bart de Jong will manage Millennium’s TiO2 and Performance
Chemicals business
TiO2 business remains headquartered in Baltimore, Maryland
TiO2 commercial management unchanged
Acetyl business will be integrated into Houston-based operations
Specialty Chemicals business remains headquartered in Jacksonville, Florida
Shareholder Votes November 30 Anticipated Close Date December 1
Timing
1,600 1,400 1,200 1,000 800 600 400 200 0
($ in U.S. millions) $1,670
1,800
Total Liquidity
Total
($ in U.S. millions) Capitalization
COMBINED CAPITALIZATION AND LIQUIDITY
Lyondell
At 6/30/04 Combined
Debt 8,070
Cash 790
Net Debt 7,280
Current Market Capitalization (approx) 5,500
Total Capitalization 12,780
Net Debt / Total Capitalization 57%
A/R Facilities and Undrawn Portion of Revolvers
Cash
6/30/04 $790 $880
WHAT IT MEANS TO MILLENNIUM CHEMICALS
For Customers
Lyondell has a strong commitment to Millennium’s core businesses and customers
Operational Excellence Model in both companies -committed to a competitive cost profile globally
Proven expertise with technology advancements
For Communities
Both companies strongly promote responsible safety, health and environmental principles and practices
Top tier safety performance
WHAT IT MEANS TO MILLENNIUM CHEMICALS
For Investors
Continued access to upturn in ethylene cycle
Diversity through increased product depth and breadth Consolidated ownership of Equistar Increased visibility in the investment community
Increased market capitalization expands access to potential investors
Increased trading volumes
Attractive dividend
WHAT IT MEANS TO MILLENNIUM CHEMICALS
For Employees
Be a part of a larger scale enterprise
Shared values
Continued presence in Baltimore for TiO2
Millennium Chemicals