Dow and DuPont delay their merger | January 30, 2017 Issue - Vol. 95 Issue 5 | Chemical & Engineering News
Volume 95 Issue 5 | p. 10 | News of The Week
Issue Date: January 30, 2017

Dow and DuPont delay their merger

The two firms promise to preserve R&D jobs to get European approvals
Department: Business
Keywords: business, mergers & acquisitions, earnings, research
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Breen
Credit: DuPont
A photo of DuPont CEO Edward Breen.
 
Breen
Credit: DuPont
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Liveris
Credit: Peter Cutts Photography
A photo of Dow Chemical CEO Edward Breen.
 
Liveris
Credit: Peter Cutts Photography

Both DuPont and Dow Chemical reported strong fourth-quarter earnings last week, but they also confirmed what most already expected: Their planned merger now won’t likely close until sometime in the second quarter this year.

The two were planning to complete their $130 billion union by March, but protracted negotiations with European Union officials about jobs and research in the combined entity’s crop protection business caused the latest postponement.

In a conference call with investors, DuPont CEO Edward Breen said Dow and DuPont are working on a “remedy package” to satisfy European authorities. Although he did not back off promises that Dow and DuPont would achieve cost savings of $3 billion in the combination, he said they “are not reducing at all the scientists that work on discovery and new product development.”

In his call with analysts, Dow CEO Andrew Liveris added that he was “confident” Dow and DuPont could solve their issues with the Europeans and that other country regulators would approve the deal once that happens.

For the quarter ending Dec. 31, DuPont reported a net income of $265 million, exceeding analysts’ expectations. In the fourth quarter of 2015, the firm had a loss of $253 million. Sales decreased about 2% to $5.2 billion.

Dow reported a net income of $1.1 billion before a $1 billion pretax charge for future asbestos-related costs, and other items turned that number into a $33 million loss. Dow’s net income for the quarter last year was also about $1.1 billion. Sales increased 14% from a year ago to $13 billion.

 
Chemical & Engineering News
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Comments
Marcray Edwards  (Tue Jan 31 02:26:45 EST 2017)
Will Dow hire all or some of the contract workers? Particularly in reference to the ones in Ohio in the US.
Curtis A Reid (Tue Jan 31 11:06:01 EST 2017)
DuPont doesn't have enough sense to come in out of the rain.
Lisa Griffin (Fri Feb 03 13:27:01 EST 2017)
I have been trying to get a severance package since Jan 2016 and have had no luck , I know of instances where employees are going to their leaders and getting their name on a list and have gotten severance packages , my leaders have told me they want their employees happy and I have expressed to my leaders that would make me happy and I also told my leaders I would be willing to stay and train someone. I also know of some individuals that received severance packages and the individuals were not ready to leave and this did not make for a happy situation .

thank you,

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