DuPont, Dow Chemical announce merger, then 3-way split

Dow DuPont logosWILMINGTON, DELAWARE (12/11/2015) The DuPont and Dow Chemical companies will merge, their executives announced this morning in a joint statement.

The merger was approved unanimously by their boards of directors “in an all-stock merger of equals.”

The combined company will be named DowDuPont.

The companies intend to then pursue a separation of DowDuPont into three independent, publicly traded companies through tax-free spin-offs, the statement said, within two years following the closing of the merger. The changes are subject to regulatory and board approval.

“The new companies will include a leading global pure-play agriculture company; a leading global pure-play material science company and a leading technology and innovation-driven specialty products company,” according to the statement. “Each of the businesses will have clear focus, an appropriate capital structure, a distinct and compelling investment thesis, scale advantages, and focused investments in innovation to better deliver superior solutions and choices for customers.”

Andrew N. Liveris, Dow’s chairman and chief executive officer, will become executive chairman of the DowDuPont.

“This transaction is a game-changer for our industry and reflects the culmination of a vision we have had for more than a decade to bring together these two powerful innovation and material science leaders,” Liveris said.

Edward D. Breen, chairman and chief executive officer of DuPont, will become CEO of the new company.

“This is an extraordinary opportunity to deliver long-term, sustainable shareholder value through the combination of two highly complementary global leaders and the creation of three strong, focused, industry-leading businesses, Breen said.

DuPont and Dow shareholders will each own approximately 50 percent of the combined company, on a fully diluted basis, excluding preferred shares, according to the joint statement.

Gov. Jack Markell issued a statement saying, “Delaware has been home to DuPont’s global headquarters for more than 200 years and to an important Dow Electronics Materials business for decades. These are world class companies whose merger has the potential to spawn three well-positioned competitors in the agriculture, material sciences and specialty products sectors.

“I have spoken to DuPont CEO Ed Breen about plans for DowDuPont. We have talked about the great business environment in Delaware and the many talented scientists, engineers and business leaders who call Delaware home and who can be at the center of growth for the three new businesses. We will continue to advocate that Delaware’s many advantages can be of major benefit to the new companies.

“None of this, of course, is of any solace for the workers and families who will be affected by this transition. The state is committed to supporting those affected by DuPont’s cost cutting in Delaware.”

More details on the DowDuPont deal

Read the DowDuPont news release