International. DowDuPont said Tuesday it will alter its original plan to split into three independent companies. The company indicated that its Board of Directors and management, with the assistance of independent advisors, completed a comprehensive review of the portfolio composition of the planned companies: Agriculture, Materials Science and Specialty Products.
The board concluded that "in light of the knowledge gained since the announcement of the transaction, certain specific adjustments will be made between the Materials Science and Specialty Products divisions, which will increase the competitive advantages of the resulting companies," the company said in a press release. "The changes better align these businesses with the end markets they serve, ensuring clear focus, market visibility, targeted innovation and stronger growth profiles, and better equipping each to successfully compete as industry leaders."
According to the press release, the Board of Directors approved the changes based on "a comprehensive review led by independent directors, which included recommendations provided by McKinsey & Company; a comprehensive business and operational analysis that leverages the knowledge gained during the last 20 months of pre-merger planning; and input from a wide range of stakeholders, including both investors and financial advisors."
As a result, DowDuPont said it will re-align the following businesses to the Special Products Division of the Materials Science Division:
- Dow's Automotive Systems' adhesive and fluid platforms;
- The Dow Building Solutions business;
- Dow's Water and Process Solutions business;
- Dow's pharmaceutical and food solutions business;
- Dow's Microbial Control business;
- DuPont's Performance Polymers business;
- Several silicone-based businesses align with applications in industrial LED, semiconductor, medical, as well as Molykote® brand lubricants for automotive and industrial equipment and Multibase Inc, which provides solutions for the thermoplastic compounding industry.
DowDuPont said that in a planned 2017, the businesses that will be realigned to the Special Products Division represent total net sales of more than $8 billion and operating EBITDA of approximately $2.4 billion (including approximately 40 percent of Dow Corning EBITDA).
- In connection with the original merger agreement, dowDupont's adjustments are as follows:
- Approximately $4 billion of net sales from Dow's legacy portfolio evenly divided between the Consumer Solutions and Infrastructure Solutions segments;
- Approximately $4 billion of net sales from the equity of DuPont Performance Polymers' business moving into the Specialty Products Division.
