Dow and DuPont detail deal discussions

Dow Chemical and DuPont have filed a prospectus for their planned merger with the Securities & Exchange Commission. The document reveals that the two companies, surprisingly, talked merger before Edward Breen took over as DuPont’s CEO last October and that both firms had other suitors that wanted to explore agricultural deals.

Dow CEO Andrew N. Liveris met with Breen’s predecessor, Ellen J. Kullman, in New York City in November 2014, though the casual talks did not yield negotiations. Liveris and Kullman met again last May to discuss a possible merger of equals. A month later, Dow and DuPont executives elaborated on these discussions and also floated the possibility of a business swap.

Liveris and Kullman had other meetings in August and September where they discussed merging and then separating the combined company into two firms—one an agricultural chemical and seeds business and another that combined the rest of Dow’s and DuPont’s businesses.

When Breen replaced Kullman last October, Dow and DuPont deepened the discussions. The talks gradually yielded the plan, unveiled in December, to merge the companies and subsequently separate them into three firms.

But the companies were considering other options as well. DuPont explored acquiring a firm that in the filing is dubbed Company 1. Company 1 is described as a firm “in the agricultural sciences industry” that had retained Goldman Sachs as an adviser on a “separate potential transaction.”

Last year, Syngenta retained Goldman as its adviser in its takeover battle with Monsanto.

DuPont was also approached by another firm, a “large, publicly traded” chemical company, about potential deals. The chairman of this company met with Breen in New Jersey. The company later floated the idea of a cash purchase of DuPont’s agriculture business and other transactions.

Dow, meanwhile, was talking with two “agricultural sciences” firms as well as a large chemical maker interested in its agriculture business.