May 21, 2007 Olin 

Olin Corporation to acquire chlor-alkali producer Pioneer

Acquisition of Pioneer Companies

Olin Corporate Strategy
1. Build on current leadership positions in Chlor-Alkali, Metals and Ammunition
 ー Improve operating efficiency and profitability
 ー Integrate downstream selectively
 ー Expand globally where profitable
2. Allocate resources to the businesses that can create the most value
3. Manage financial resources to satisfy legacy liabilities

Pioneer: A High Value Acquisition, Consistent with our Strategy
Synergistic, bolt-on acquisition
Enhances our chlor-alkali franchise
 ー #3 in chlor-alkali, up from #4
 − Diversifies geographic coverage
 − Improves overall cost position
 − #1 in industrial bleach
Further low-cost expansion opportunities in the largest chlorine consuming region of North America
Significant near-term cost synergies of $35 million
Financial metrics are very compelling
 − Immediately accretive to EPS and remains highly accretive throughout the cycle
 − Balance sheet remains strong

Transaction Summary
 ・ Olin Corporation to purchase Pioneer Companies for $35.00 per share
Firm Value: $411 million
 ・ Equity value of $418 million at the agreed purchase price
 ・ Net cash position of $7 million assumed by Olin (cash of $129 million, total debt of $122 million)
Financial Impact on Olin Corporation
 ・ Immediately accretive to EPS and remains highly accretive over the cycle
 ・ Balance sheet remains strong
Necessary Approvals
 ・ Pioneer shareholder approval
 ・ Regulatory approval

Pioneer: A Focused Company with Quality Assets
 ・ Pioneer is focused exclusively on chlorine / caustic, bleach 漂白剤 and derivatives
 ・ World class operations
  − St. Gabriel, LA: Strategically positioned with pipeline to Gulf Coast customers;
    expansion project lowers costs
  − Becancour, PQ: Low cost hydro-power based facility with downstream production capabilities
  − Henderson, NV: Western US facility with captive consumption for downstream products

Pioneer purchased the Henderson Facility in October 1988 from a subsidiary of ICI Americas, Inc. (ICI). ICI acquired the facility in connection with the purchase of Stauffer Chemical Company.

  − Dalhousie, NB: Provides exposure to sodium chlorate markets
 ・ Strong downstream capabilities
  − Chlorine pipeline to the major urethanes, vinyls and ag chemicals customers
  − 5 bleach plants in key parts of North America
 ・ Superior financial results
  − Excellent margins in chlor alkali and downstream businesses
  − Generated 2005 peakEBITDA of $126 million
  − St. Gabriel project will further lower costs and expand capacity
  − Synergies provide enhanced earnings throughout the cycle

Impact of the Combination on Olin
 The combination would make Olin the third largest producer of chlor-alkali in North America

Enhanced Operational and Geographic Platform 
  Strengthens Olin’s position in core businesses and adds a strong bleach business in the West

Short Tons

McIntosh, AL


Augusta, GA


Niagara Falls, NY


Charleston, TN


McIntosh, AL (50% Sunbelt*)


Olin 計)


Becancour, Quebec


St. Gabriel, LA


Henderson, NV


Dalhousie, NB


Pioneer 計)




* Sunbelt Chloralkali is a 50:50 joint venture between PolyOne and Olin Corporation