STARBOARD DELIVERS LETTER TO HUNTSMAN SHAREHOLDERS

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Mar 25, 2022, 09:51 ET

NEW YORK, March 25, 2022 /PRNewswire/ -- Starboard Value LP (together with its affiliates, "Starboard" or "we"), one of the largest shareholders of Huntsman Corporation (NYSE: HUN) ("Huntsman" or the "Company"), with an ownership interest of approximately 8.8% of the Company's outstanding shares, today announced that it has delivered an open letter to Huntsman shareholders.

The full text of the letter to Huntsman shareholders follows:

Dear Fellow Shareholders,

As you know, Starboard Value LP (together with its affiliates, "Starboard" or "we") is one of the largest shareholders of Huntsman Corporation ("Huntsman" or the "Company"), with an ownership stake of approximately 8.8% of the Company's outstanding shares.

While we are disappointed by the results of this election, we appreciate the significant number of shareholders that voted for change. In fact, based on preliminary results, it appears as though less than 50% of the shares outstanding supported the Company's contested nominees. We hope that the Board recognizes that this clearly shows that shareholders not only expect management to fulfill its promises, but also expect the Board to hold management accountable for these promises.

Since our involvement with Huntsman, the Company has made a series of new promises to shareholders, including:

Promise to generate at least $1.4 billion in Adjusted EBITDA in 2022 with Adjusted EBITDA margins of approximately 17%.
Promise to maintain an Adjusted EBITDA to Free Cash Flow conversion of at least 40% beginning in 2022.
Promise to achieve the following segment-level Adjusted EBITDA margins by 2024:

Polyurethanes: 18 – 20%
Performance Products: 20 – 25%
Advanced Materials: 20 – 25%
Textile Effects: 13 – 15%
We would note that any manipulation of corporate expense allocation in order to meet the above segment-level Adjusted EBITDA margin targets would not constitute fulfillment of the Company's promise.

Promise to achieve total Company Adjusted EBITDA margins of 18 – 20% by 2024.

We would note that if the Company sells Textile Effects, it would equate to an estimated pro forma Adjusted EBITDA margin target of approximately 19 – 21%.

Promise to complete a $1.0 billion share repurchase program within the next two years (i.e. by the end of 2023).
Promise to eschew large acquisitions and spend less than $500 million on any single transaction.
Promise to conduct a strategic review of the Textile Effects business.
Promise to align 100% of the Company's incentive cash bonus program to the achievement of the Adjusted EBITDA margin, optimization program, and free cash flow targets set out at the 2021 Investor Day.
Promise to have 70% of equity-based compensation tied to achievement of three-year relative TSR goals and two-year corporate free cash flow targets.

We expect Huntsman's management team, the Board, research analysts, and shareholders to keep these specific promises as a checklist for accountability. We also expect the Company to understand that shareholders deserve to see Huntsman transformed into a company that executes with excellence.

While we may not be on the Board, rest assured that we will be watching with great interest.

Once again, thank you for your support.

Best Regards,

Jeffrey C. Smith
Managing Member
Starboard Value LP

About Starboard Value LP

Starboard Value LP is a New York-based investment adviser with a focused and differentiated fundamental approach to investing primarily in publicly traded U.S. companies. Starboard seeks to invest in deeply undervalued companies and actively engage with management teams and boards of directors to identify and execute on opportunities to unlock value for the benefit of all shareholders.

Investor contacts:

Gavin Molinelli, (212) 201-4828
Patrick Sullivan, (212) 845-7947
www.starboardvalue.com

SOURCE Starboard Value LP