DuPont And Dow Make Their Huge Merger Official

This transaction is a major accelerator in Dow’s ongoing transformation, and through this we are creating significant value and three powerful new companies.

Dow harks back to 1897, after Herbert Henry Dow discovered a new way to extract the element bromine — then a useful ingredient in medicine and photographic materials – from brine located in wells around Midland, Michigan, its current base.

Analysts said a tie-up would merge two agricultural chemicals businesses and fold in DuPont’s seeds business, which would bring the merger under the lens of regulators.

It’s been a bumpy 2015 for DuPont, whose legacy reaches back to 1802 when E. I. du Pont built a series of gunpowder mills along the banks of the Brandywine River near Wilmington, Delaware, where the company is still based.

Talks of a merger between DuPont and Dow Chemical Co. have most probably been pushed along by pressure from shareholders as well as the weakening demand of chemicals to protect crops.

Dow AgroSciences, meanwhile, had global sales of $7.3 billion in 2014.

Dow Chief Executive Officer Andrew Liveris, 61, will become executive chairman.

Monsanto says it’s still looking for deals.

The deal is expected to close in the second half of 2016, with the segmentation taking place up to two years later. Peltz has called for DuPont’s agriculture, nutrition and health and industrial biosciences units to be combined into a single growth company, separate from the more cyclical businesses of performance materials, safety and protection, and electronics and communication. Last year, the company added two directors nominated by Daniel Loeb’s Third Point LLC after Mr. Loeb sought a breakup of the company and threatened a proxy fight.

Last month, The Wall Street Journal reported that DuPont was discussing a potential combination of its agriculture division with seed giant Syngenta AG, and separately exploring a potential agriculture deal with Dow.

Dow announced earlier this year that it was selling its AgroFresh specialty chemical business to buyout company Boulevard Acquisition Corp. for $860 million.