DuPont and Dow Plan “Merger of Equals”
The anticipated mega-merger between two of the country’s largest and oldest chemical companies was announced on Dec. 11. Both companies approved a definitive agreement under which they will combine in an all-stock merger of equals, to be called DowDuPont. It will comprise three business units: Agriculture, Materials Science, and Specialty Products. The plan is to separate these units into three independent, publicly traded companies 18 to 24 months after the merger, expected to close in the second half of this year.
Andrew Liveris, Dow’s president, chairman, and CEO, will be named executive chairman of the merged firm; and Edward Breen, DuPont chairman/CEO, will be named CEO. The unnamed future “Materials Science Company” will be led by Liveris and will include Dow’s Performance Plastics, Performance Materials & Chemicals, Infrastructure Solutions, and Consumer Solutions, as well as DuPont’s Performance Materials segment. DuPont’s Breen will lead the other two companies.
The Materials Science Company will include Dow’s PE resins and its broad portfolio of TPEs, along with DuPont’s nylons, PBT, acetal, TPEs, and biopolymers. Also to be included are DuPont’s polymer additives and modifiers and specialty resins used in barriers, sealants, peelable lidding, and adhesives. The DuPont Teijin Films business will also be included in the merger. About 70% of the Materials Science Company’s sales will come from packaging, transportation, and construction.
In a separate announcement, which will further impact the Materials Science business, Dow signed definitive agreements to restructure the ownership of Dow Corning. Dow will become the 100% owner of Dow Corning, now a 50/50 joint venture with Corning, Inc. This will extend Dow’s plastics-related activities to include silicones and silanes.
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