Dow Chemical to take full control of JV with Corning

However, DowDuPont won’t be around long.

The split of three-ways will not occur for the next 18 to 24 months following the close of the deal, which is expected during the last six months of 2016.

“The addition of a silicones position will expand our product offerings across multiple businesses while driving innovative solutions that will enable us to go deeper into key end markets by leveraging Dow’s existing, strong science and engineering competencies across new chemistries”, Liveris said in the statement.

Now the corporations estimate that the proposed plan will result in cost synergies, mostly in agriculture, of $3 billion, resulting in an additional $30 billion of market value, at a cost of about $4 billion.

Dow is buying out Corning in their joint venture of Dow Corning, a deal worth $4.8 billion, which is expected to generate $1 billion in revenues.

About 10% of the cost cutting will come from R&D, mostly in agriculture, where executives see redundancies in work on seed traits. This company’s combined 2014 revenue was about $51 billion on an adjusted basis. Dow would being about $45 billion in net sales to this new company, while DuPont would bring about $6 billion.

“Over the last decade our entire industry has experienced tectonic shifts as an evolving world presented complex challenges and opportunities, requiring each company to exercise foresight, agility and focus on execution”, Liveris said.

The proposed agriculture business would unite DuPont’s and Dow’s seed and crop protection businesses, which had combined pro forma 2014 revenue of about $19 billion. However, other deals may be in the offing. Another factor has been Monsanto’s bid for Syngenta, which was withdrawn in August.

After the merger, the company plans to divide into separate entities. Specialty products, encompassing electronics, nutrition, industrial biosciences and safety, would have revenue of about $13 billion. Each of these businesses will be able to allocate capital more effectively, apply its powerful innovation more productively, and extend its value-added products and solutions to more customers worldwide. USA antitrust regulators sued to block General Electric ‘s (NYSE:GE) attempt to sell its home appliance unit to Sweden’s Electrolux (OTCPK:ELUXY) for $3.3 billion, arguing it would hurt competition.

The National Corn Growers Association said it would study the merger’s likely impact on agricultural research, grain pricing, and the cost of seeds and pesticides, and “will do all we can to protect farmer interests and preserve an open and competitive marketplace”. “We believe this is the right way”.

Following the closing of the transaction, the new company, DowDuPont, will be dual-headquartered in Midland and Wilmington, Del., where DuPont is headquartered today.

Nelson Peltz, an activist investor who has been prodding DuPont to break up, and Daniel S. Loeb, who has been doing the same for Dow, have yet to weigh in on the merger. And each has sought separately in recent years to reinvent itself as a maker of more-profitable products while facing pressure from major investors agitating for faster, bolder moves.