European Commission clears DuPont deals linked to Dow merger

The European Commission has conditionally approved the sale by DuPont of part of its crop protection business to FMC Corp. and DuPont's acquisition of FMC's health and nutrition business.

The deals cleared Thursday help DuPont meet commission requirements for DuPont's pending $62 billion merger with Dow Chemical, the parent company of Indianapolis-based Dow Agrosciences.

The merger was announced in December 2015 and was initially expected to close in the first half of 2016. But it was delayed several times while U.S. and foreign regulators reviewed it.

The European Commission cleared the merger in March, subject to conditions including DuPont selling major parts of its global pesticide business.

Dow Chemical is based in Midland, Michigan. DuPont has its headquarters in Wilmington, Delaware.

Dow and DuPont are planning to split the merged company into three within 18 months of closing the deal, with the first spinoff set to be a materials-science company that will retain the Dow name.

The new company will be called DowDuPont and have dual headquarters in Midland and Wilmington.

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

Dow Agro on Thursday reported second-quarter sales of $1.6 billion, up 3 percent from the same quarter of 2016. The increase was driven by a double-digit increase in the seeds business, the company said, with strong demand for corn seeds in Latin America and cotton seeds in North America.

Operating earnings before interest, taxes depreciation and amortizationwere $326 million, up from $232 million in the year-ago period.

Meanwhile, Dow Chemical reported second-quarter earnings of $1.32 billion, or $1.07 per share.

Earnings, adjusted for non-recurring costs, came to $1.08 per share, topping analyst expectations of $1.01 per share.

The specialty chemicals maker posted revenue of $13.83 billion in the period, also surpassing Wall Street forecasts.Analysts expected $13.65 billion.

Please enable JavaScript to view this content.

Editor's note: IBJ is now using a new comment system. Your Disqus account will no longer work on the IBJ site. Instead, you can leave a comment on stories by signing in to your IBJ account. If you have not registered, please sign up for a free account now. Past comments are not currently showing up on stories, but they will be added in the coming weeks. Please note our updated comment policy that will govern how comments are moderated.

{{ articles_remaining }}
Free {{ article_text }} Remaining
{{ articles_remaining }}
Free {{ article_text }} Remaining Article limit resets in {{ count_down }} days.