Dow Chemical Divests Assets; No Mention Of Loeb

More than a year ago The Dow Chemical Company (NYSE: DOW) today announced that it was planning to divest several billion dollars worth of non-strategic assets. In moving forward with Dow’s plans to divest $4.5 billion to $6 billion of non-strategic businesses and assets by 2015, the company confirmed on October 2nd that its Angus Chemical Company, Sodium Borohydride and AgroFresh businesses are all currently being marketed with actively interested parties. The firm anticipates finalizing these transactions in early 2015. Based on expert valuations, these businesses are expected to collectively sell for more than than $2 billion.

Other Dow Chemical divestment news

The Dow Chemical Company (NYSE: DOW) also announced it has finalized the sale of most of its North America rail car fleet, and plans to convert to a lease structure going forward. This step alone produced $450 million in cash proceeds.

Michael Mauboussin: Challenges and Opportunities in Active Management And Using BAIT #MICUS

michael mauboussin, Credit Suisse, valuation and portfolio positioning, capital markets theory, competitive strategy analysis, decision making, skill versus luck, value investing, Legg Mason, The Success Equation, Think Twice: Harnessing the Power of Counterintuition, analysts, behavioral finance, More Than You Know: Finding Financial Wisdom in Unconventional Places, academics , valuewalkMichael Mauboussin's notes from his presentation at the 2020 Morningstar Investment Conference, held on September 16th and 17th. Q2 2020 hedge fund letters, conferences and more Michael Mauboussin: Challenges and Opportunities in Active Management Michael Mauboussin is Head of Consilient Research at Counterpoint Global in New York. Previously, he was Director of Research BlueMountain Capital, Read More

The company also continues to move forward on the carve-out of its U.S. Gulf Coast Chlor-Alkali/Chlor-Vinyl, Global Chlorinated Organics and Epoxy divisions, which are projected to generate a total EBITDA of more than $500 million annually. A separate structure for the carve-out is being developed, with more details available in the near future. Of note, the carve-out has received significant market interest, with signed agreements expected in Spring 2015.

All transaction options will be carefully examined to ensure Dow receives maximum value for the businesses and its shareholders.

Dow’s completed divestitures add up to $1.3 billion so far, and the anticipated proceeds of the divestment  program trending toward the higher end of the firm’s $4.5 billion to $6 billion range.

Update on joint venture restructurings

Furthermore, as was mentioned in Dow’s second quarter 2014 earnings call, the firm continues to work toward enhancing the value created through its major joint ventures by simplifying the structure and sharpening the focus of these partnerships.

One initial step in this direction is with Univation. The Dow Chemical Company (NYSE: DOW) has recently signed a definitive agreement with ExxonMobil Chemical Company regarding an ownership restructure of Univation Technologies, LLC. Currently a 50/50 joint venture, the proposed transaction will result in Univation Technologies becoming a wholly-owned subsidiary of Dow. Univation Technologies industry leading process knowledge will be a major addition to Dow’s Performance Plastics franchise and cement the firm’s leadership position in this rapidly growing sector.