Dow and DuPont have agreed to consolidate as equals, creating three new firms, including a materials science giant that will cover packaging.
Under a deal announced on 11 December, the companies will combine in an all-stock merger of equals, creating a combined company to be named DowDuPont.
The parties intend to then pursue a separation of DowDuPont into three independent, publicly traded companies through tax-free spin-offs. This would occur as soon as feasible, which is expected to be 18-24 months following the closing of the merger, subject to regulatory and board approval.
Along with an agricultural company and a specialty products company, the merger will create a materials science company, which will cover fields including packaging.
The material science company is to be “a pure-play industrial leader”, consisting of DuPont’s performance materials segment as well as Dow’s performance plastics, performance materials and chemicals, infrastructure solutions, and consumer solutions (excluding the Dow electronic materials business) operating segments.
With combined pro forma 2014 revenue for material science of about USD51 billion, the new company will cover high-growth, high-value industry segments in packaging, transportation, and infrastructure solutions.