Dow/DuPont merger complete
DuPont and Dow AgroSciences parent company Dow Chemical have completed their planned merger as of August 31st.
DuPont and Dow AgroSciences parent company Dow Chemical have completed their planned merger as of August 31st. The combined entity is operating as the holding company, DowDuPont, with three divisions covering agriculture, materials science and specialty products. They are due to be spun off as separate legal entities within 18 months of the completion date. The agriculture business will be headquartered at DuPont’s home town of Wilmington, Delaware, with global business centres in Johnston, Iowa (where DuPont seed subsidiary DuPont Pioneer was based) and Indianapolis, Indiana (where Dow AgroSciences was based). James Collins (formerly executive vice-president for DuPont and head of its agriculture business) is the chief operating officer of the agriculture business.
Shares of DuPont and Dow ceased trading at the close of the New York Stock Exchange on August 31st. DowDuPont began trading on September 1st under the ticker symbol, DWDP. Pursuant to the merger agreement, Dow shareholders received a fixed exchange ratio of one share of DowDuPont for each Dow share and DuPont shareholders received a fixed exchange ratio of 1.282 shares of DowDuPont for each DuPont share.
The board of directors of DowDuPont comprises 16 members, eight formerly on the DuPont board and eight from the Dow board. Three advisory committees have been established by the DowDuPont board to oversee the establishment of the agriculture, materials science and specialty products divisions in preparation for the separations. The committees will develop a capital structure and designate the future chief executive officer and leadership team of their respective companies.
The DowDuPont board is conducting a comprehensive portfolio review in order to capture any “material value-enhancing opportunities” in preparation for the intended creation of the three separate businesses. The merger is expected to result in cost synergies of some $3 billion within two years of completion and $1 billion in growth synergies.
The merger was approved by antitrust regulators in the US, EU and elsewhere on condition that DuPont divest a major part of its global herbicides and insecticides business and most of its worldwide crop protection R&D operation. FMC agreed to acquire the assets in April. They include the cereal herbicides, azimsulfuron, chlorsulfuron, ethametsulfuron, flupyrsulfuron, lenacil, metsulfuron, thifensulfuron, tribenuron and triflusulfuron, and the insecticides, chlorantraniliprole (trade-marked as Rynaxypyr), cyantraniliprole (trade-marked as Cyazypyr) and indoxacarb. The deal also covered DuPont’s R&D pipeline and organisation, excluding seed treatments, nematicides and late-stage R&D programmes.