American conglomerates, Dow Chemical, DuPont complete a $130bn mega-merger
September 2, 20171.5K views0 comments
Dow Chemical Co. and DuPont Friday completed their $130 billion merger, which was originally announced in December 2015. Each company’s shares stopped trading at the close Friday August 31 with the combined DowDuPont listing under ticker symbol “DWDP”.
“The true value of this merger lies in the intended creation of three industry powerhouses that will define their markets,” Andrew Liveris, executive chairman of DowDuPont, said in a statement on Friday.
According to reports, Dow contributes two-thirds of the combined $77 billion in yearly sales, and more than half of the 100,000 employees and $150 billion in market value, but the companies call the union a ‘merger of equals,’ with eight directors from each side on the combined board. That allows the bosses to do their spin-offs without paying income tax on sales proceeds.
Post-merger, Dow and DuPont are expected to break up into three independent, publicly traded units.
Analysts say the union may look like the final act of one of the largest M&A transactions of all time, but it’s really more of an interim step before DowDuPont breaks itself back up.
The plan is to split into three independent, publicly-traded companies — agriculture, material sciences and specialty products — although some like activist investor Dan Loeb believe more value could be created by adding a fourth sliver to the split stool.