Sterling Chemicals to be Acquired by Eastman Chemical

STERLING CHEMICALS, INC. (SCHI) announced today that it has entered into a definitive merger agreement pursuant to which Eastman Chemical Company EMN will acquire all of the outstanding equity of Sterling Chemicals for $100 million in cash, subject to certain adjustments as provided in the merger agreement. Under the terms of the transaction, the holders of Sterling Chemicals' common stock, par value $0.01 per share, will receive $2.50 per share in cash, representing a 63% premium over the most recently reported market price of $1.53 and a 94% premium over the 90 day volume-weighted average trading price. Although, as of April 1, 2011, the aggregate Liquidation Value of Sterling Chemicals' outstanding shares of Series A Convertible Preferred Stock was $110,070,204, which aggregate Liquidation Value will increase to $114,473,006 on July 1, 2011, the holders of Sterling Chemicals' outstanding shares of Series A Convertible Preferred Stock have agreed to support the transaction and will only receive $92,928,850 in the aggregate in respect of their Series A Convertible Preferred Stock, subject to adjustment as provided in the merger agreement. The merger, which has been approved by the Sterling Chemical's board of directors upon the recommendation of a special committee of independent directors and by the board of directors of Eastman Chemical, is expected to close in the third quarter of 2011 after receipt of required regulatory approvals and the satisfaction of other customary closing conditions.