DOW
FTC approves UCC merger / Metallocene PE technology to BP / ”Unipol” part of Univation
Dow Chemical (Midland, Michigan / USA; www.dow.com) has received the long-awaited green light from the US Federal Trade Commission (FTC) for its merger with Union Carbide Corp. (UCC, Danbury, Connecticut / USA; www.unioncarbide.com). This follows EU approval last May (PIE 09, 2000). While being called a merger, the deal is actually an acquisition. In future, UCC will operate as a wholly owned subsidiary of the worldwide Dow organisation, boosting pro forma sales to USD 28.4 bn. The two businesses combined had earnings of USD 2.1 bn before interest and taxes in 2000 and assets of USD 36m.
With the incorporation of UCC, Dow becomes world´s largest chemical company, ahead of DuPont. Dow CEO Michael J. Parker said the fusion will create more cost synergies than the USD 500m originally anticipated when the plans were announced in August 1999. He added that savings “will begin immediately and will be fully realised within two years.” Len Azzaro, Dow´s global vice president for polyethylene, said the combination of Dow and Union Carbide “will bring customers an enhanced technology platform and one of the industry´s broadest ranges of PE solutions.”
Both US and European regulatory authorities have placed restrictions on the new union. The EU mandated that UCC either sell its 50% stake in Polimeri Europe, the joint venture in PE with Italy´s EniChem (I-20097 San Donato Milanese; www.enichem.it), or “cause Polimeri to sell its Italian production plant for C8 LLDPE” (see story in this issue). Dow has also agreed to divest to BP (GB-London EC 2M 7BA; www.bp.com) its interest in an R&D project to develop metallocene catalysts for gas phase PE as well as patents and other processes related to gas phase PE.
To fulfil another EU restriction, UCC will contribute its “Unipol” PE licensing and PE conventional catalyst business to Univation Technologies. Dow thus will become a 50:50 partner in Univation with ExxonMobil Chemical. To appease the FTC, Dow has agreed to sell its ethanolamines (EOA) activities (starting materials for PU, among other things) and the North American GAS/SPEC business to Ineos plc of the UK (see Plasteurope.com 02, 2001 – EVC). The global ethyleneamines (EA) portfolio will go to Huntsman. Together Dow and UCC controlled 100% of the North American ethyleneamines market and a “large percentage globally,” according to Dow´s Parker.
• Plasteurope.com Service: Special issue of ”Around Dow” (English) on Dow-UCC merger, with historical and strategic overview: PIE-No. 45062.
With the incorporation of UCC, Dow becomes world´s largest chemical company, ahead of DuPont. Dow CEO Michael J. Parker said the fusion will create more cost synergies than the USD 500m originally anticipated when the plans were announced in August 1999. He added that savings “will begin immediately and will be fully realised within two years.” Len Azzaro, Dow´s global vice president for polyethylene, said the combination of Dow and Union Carbide “will bring customers an enhanced technology platform and one of the industry´s broadest ranges of PE solutions.”
Both US and European regulatory authorities have placed restrictions on the new union. The EU mandated that UCC either sell its 50% stake in Polimeri Europe, the joint venture in PE with Italy´s EniChem (I-20097 San Donato Milanese; www.enichem.it), or “cause Polimeri to sell its Italian production plant for C8 LLDPE” (see story in this issue). Dow has also agreed to divest to BP (GB-London EC 2M 7BA; www.bp.com) its interest in an R&D project to develop metallocene catalysts for gas phase PE as well as patents and other processes related to gas phase PE.
To fulfil another EU restriction, UCC will contribute its “Unipol” PE licensing and PE conventional catalyst business to Univation Technologies. Dow thus will become a 50:50 partner in Univation with ExxonMobil Chemical. To appease the FTC, Dow has agreed to sell its ethanolamines (EOA) activities (starting materials for PU, among other things) and the North American GAS/SPEC business to Ineos plc of the UK (see Plasteurope.com 02, 2001 – EVC). The global ethyleneamines (EA) portfolio will go to Huntsman. Together Dow and UCC controlled 100% of the North American ethyleneamines market and a “large percentage globally,” according to Dow´s Parker.
• Plasteurope.com Service: Special issue of ”Around Dow” (English) on Dow-UCC merger, with historical and strategic overview: PIE-No. 45062.
15.02.2001 Plasteurope.com [16870]
Published on 15.02.2001