Not Clear Yet What the Dow-DuPont Merger Means for West Virginia

“And I would say just looking at it consolidation should happen.’ Similarly Dow CEO Andrew Liveris told analysts in October that there were ‘potential synergies in a newly consolidating agricultural market” regarding Dow AgroSciences. “We believe this is the right way”.

Excluding preferred shares, existing shareholders of Dow and DuPont will each own about 50 percent of the combined company, to be called DowDuPont.

The Dow Chemical logo is shown on a wall at its corporate headquarters in Midland, Michigan, US. The leadership and location of the three eventual companies hasn’t been decided.

The companies have been struggling with falling demand for farm chemicals due to slumping crop prices and a strong dollar, even as their plastics businesses thrive thanks to low natural gas prices. The pact will lead to $3 billion in cost savings, the companies said. “Now I would be surprised if we have 5,000”, Robb said.

Antitrust regulators may look favorably on the deal given the three-way split, but, ultimately, must determine how the merger will affect competition among various markets involved.

DuPont’s ag business, much of which operates under the Pioneer brand, is larger than Dow Agro.

But Breen said he and Liveris have created cost-cutting plans that should spare the most basic R&D, as well as sales teams. Further reductions are likely as the combined company streamlines ahead of its planned breakup. The DowDuPont announcement may put pressure on other companies to combine. Shares of Anheuser have risen about 8% since the deal was announced. That’s very important from a market share standpoint.

A deal would be one of the biggest in a year marked by big deals.

In the First State, industry watchers are reacting to news of Dow Chemical and DuPont’s plans to merge – and what it might mean for Delaware’s economy.

Once the union is finished, expected in the second half of 2016, stockholders of both companies will hold an equal share in the new entity, which will then be divided into two.

Liveris will be named executive chairman and Breen will be named CEO of DowDuPont.

Activist investor Nelson Peltz of Trian Partners, who has pressed DuPont to separate its businesses, said he “fully supports” the transaction and sees the combination as “a great outcome for all shareholders”. Friday’s deal is “a totally different scenario”, Mr. Breen said. “The strategic nature of what we could pull off is incredible”. DuPont said its own effiency measures will save it about $700 million.

Earlier this week, the companies’ executives testified before a Senate subcommittee, arguing that their merger will not hurt smaller brewers. Sen.

Creation of three companies that will spun off in the future is proposed. Dow would being about $45 billion in net sales to this new company, while DuPont would bring about $6 billion.

The impact of the mega-merger between Dow Chemical Co. and DuPont Co., which provide components and systems for every major global automaker, will be felt throughout the automotive supply chain. DuPont says it will be cutting its global workforce by 10%.

The transaction is expected to yield more than $US1 billion in additional annual EBITDA at full run-rate synergies, Dow Chemical said.