The merger deal between chemical giant Dow Chemical and Rohm and Haas has finally fallen through

Thread Content

Recently, the long-pending merger deal between chemical industry giants Dow Chemical and Rohm & Haas was finally called off. Dow Chemical stated that the reason it could not proceed with the acquisition was the \"unacceptable uncertainty\" caused by tense financial market conditions. ” Andrew Liveris, Chairman and CEO of Dow Chemical, said, “Dow has always been experienced and resilient in dealing with challenging market conditions, but the global economic landscape has changed significantly now, and we still cannot see when this unprecedented decline in market demand will reach its bottom.” ” Previously, Dow Chemical and Rohm and Haas stated in another statement that the merger transaction would be completed after January 27th. Lohmann Haas said it is currently considering “various alternatives” to protect the interests of its shareholders. Under the merger agreement reached by the two parties on January 10, Dow Chemical may pay Rhône-Poulenc $750 million as transaction fees to finalize the deal. At 12:07 p.m. on Monday, Eastern Time (01:07 on January 27, Beijing time), Dow Chemical’s stock price dropped by 42 cents, or 2.9%, to $13.91. In the previous four months, the market value of this stock dropped by more than half. Following the collapse of Lehman Brothers Holdings (LEHMQ) in September last year, Dow Chemical’s end markets were severely affected by the worsening credit crisis. Investors are also very concerned that a takeover by Dow Chemical could pose risks to its dividends, although the company insists it will not be affected. This company has been committed to increasing its dividend every fiscal quarter since 1912. Rohm and Haas’ stock price dropped by $10.58, or 16.1%, to $55.24. Dow Chemical has made an offer to acquire this supplier of specialty raw materials at $78 per share. Last July, Dow Chemical signed a deal to acquire Rohm and Haas for $15 billion, but it faced financing difficulties after Petrochemical Industries Co. withdrew from the joint venture that was supposed to provide financial support. Although Dow Chemical has stated that it will fund the acquisition of Rohm and Haas through a $13 billion short-term loan and a $4 billion equity investment, many analysts have long doubted whether Dow Chemical has the capacity to complete this acquisition. Last Friday, the U.S. Federal Trade Commission (FTC) approved the deal between the two parties, on the condition that Dow Chemical sell off certain assets in order to meet fair competition requirements. Last edited by zxh6267 on 2009-2-6 at 18:59.]