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Dow, DuPont may try more divestments in seeking merger approval

February 8, 2017

Dow Chemical Co. and DuPont Co. say they're willing to make more business divestments as a way to nudge European regulators who remain wary of their proposed merger.

The companies plan to join in a $62 billion deal and then break apart into three separate, publicly traded companies. The companies would focus on agriculture, material science, and the production and sale of specialty products, respectively. Antitrust regulators remain hesitant, however.

The companies say Wilmington, Delaware, will be the headquarters for the combined agricultural business, but Indianapolis—the home of Dow AgroSciences, which has about 1,500 employees—will be one of its two “global business centers.”

Dow-DuPont, the first of a trio of mega-deals reshaping the agrichemicals industry, is embroiled in an extended probe by the EU over concerns that the combination may reduce competition for crop protection, seeds and some petrochemicals. The EU is separately examining China National Chemical Corp.’s bid for Switzerland’s Syngenta AG.

Dow spokeswoman Rachelle Schikorra said Wednesday that among the concessions the companies are willing to make are the sale of part of DuPont's crop protection business—along with its associated research and development—and the sale of Dow Chemical's acid copolymers and ionomers business.

Schikorra says the deadline for the European Commission to review the proposals has been extended to April 4. She says Dow Chemical and DuPont still expect the merger to close during the first half of the year, with planned spinoffs occurring about 18 months later.

Shares of Dow, based in Midland, Michigan, and DuPont, which has its headquarters in Wilmington, Delaware, are both up about 30 percent in the last year.

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