MIDLAND, Mich., and
WILMINGTON, Del., Sept. 12, 2017 /PRNewswire/ -- DowDuPont™
(NYSE: DWDP) today announced that its Board of Directors and
management, with the assistance of independent advisors, have
completed their comprehensive review of the portfolio composition
of the three intended independent companies. The Board unanimously
concluded that, in light of knowledge gained since the announcement
of the transaction, certain targeted adjustments will be made
between the Materials Science and Specialty Products divisions,
which will enhance the competitive advantages of the intended
resulting companies. 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 equip each to compete successfully as industry leaders.
The DowDuPont Board of Directors approved the changes based on:
a thorough review led by the lead independent directors, which
included recommendations provided by McKinsey & Company; a
comprehensive business and operational analysis leveraging
knowledge gained over the past 20 months of pre-merger planning;
and input from a wide range of stakeholders, including both
investors and financial advisors. As a result of this comprehensive
analysis, DowDuPont will realign the following businesses to the
Specialty Products Division from the Materials Science
Division:
- Dow's Automotive Systems' adhesives and fluids platforms
- Dow's Building Solutions business
- Dow's Water and Process Solutions business
- Dow's Pharma and Food Solutions business
- Dow's Microbial Control business
- DuPont's Performance Polymers business
- Several silicones-based businesses aligned with applications in
industrial LED, semiconductors, medical, as well as
Molykote® brand lubricants for automotive and industrial
equipment and Multibase Inc, which provides solutions for the
thermoplastic compounding industry
On a forecasted 2017 basis, the businesses that will be
realigned to the Specialty Products Division account for total net
sales of more than $8 billion and
operating EBITDA of approximately $2.4 billion, including approximately 40
percent of the heritage Dow Corning EBITDA. Relative to the
original merger agreement, the adjustments are as follows:
- Approximately $4 billion of net
sales from the heritage Dow portfolio, evenly split between the
Consumer Solutions and Infrastructure Solutions segments; and
- Approximately $4 billion of net
sales from the heritage DuPont Performance Polymers business moving
to the Specialty Products Division.
"Our DowDuPont Board is fully aligned and confident that these
targeted portfolio adjustments are the right actions to take and
will benefit all stakeholders over the long term," said
Andrew Liveris, executive chairman
of DowDuPont. "They bear out the clear results of a significant
comprehensive analysis the Dow and DuPont boards undertook over the
past many months, which benefited from a fresh look provided by
independent, third-party external advisors, in particular McKinsey
& Company. We built on the wealth of knowledge gained as both
companies advanced our integration work together. These adjustments
are also fully supported by the Materials Science Advisory
Committee, as they better align select businesses with the market
verticals they serve, while maintaining integration and innovation
strengths within strategic value chains. As a result, both our
Materials Science and Specialty Products divisions will be
well-positioned to better anticipate and meet customer needs
through focused innovation and technology development that will
deliver accelerated growth from a broader suite of best-in-class
products."
"The changes we are making will enhance the competitive
advantages and value creation potential of DowDuPont and ensure
that the intended companies have the best possible foundation to
drive long-term value for all stakeholders," said Ed Breen, chief executive officer of DowDuPont.
"The facts clearly supported the strategic logic of this portfolio
configuration. Each of the intended companies will have even
stronger competitive positioning, high value-added customer
solutions, and a distinct and compelling investment thesis, while
maximizing opportunities for strategic growth and synergies. With
clear focus, each will serve attractive and growing markets,
investing in innovation and delivering greater returns for
shareholders."
DowDuPont reiterates its previously announced plans to achieve
run-rate cost synergies of approximately $3
billion and approximately $1
billion in growth synergies.
Following the portfolio realignments, the three intended
companies of DowDuPont are as follows:
- A leading Agriculture Company that brings together the
strengths of DuPont Pioneer, DuPont Crop Protection and Dow
AgroSciences to better serve growers around the world with a
superior portfolio of solutions (seeds, traits, crop chemicals,
seed treatment, agronomy and digital services), ensuring greater
choice and competitive price for value. The combined capabilities
and highly productive innovation engine will enable the intended
Agriculture company to bring a broader suite of products to the
market faster, so it can be an even better partner to growers,
delivering innovation and helping them to increase their
productivity and profitability.
The intended company will be
headquartered in Wilmington,
Delaware, with global business centers in Johnston, Iowa, and Indianapolis, Indiana.
- A leading Materials Science Company that will be the
premier materials science solution provider, with the vast majority
of its sales aligned with three narrower and deeper, high-growth
market verticals: packaging, infrastructure and consumer care. With
one of the strongest and deepest toolkits in the industry, the
intended company will have robust technology and asset integration,
scale and competitive capabilities to enable truly differentiated
materials science solutions for customers. The intended company
will consist of three powerful, market-leading segments:
-
- Performance Materials & Coatings, which combines a broad
range of technology platforms that empower its customers to: create
ingredients and solutions with exceptional performance and process
enhancements for home and beauty care applications; and develop
solutions that advance the performance of architectural and
industrial coatings.
- Industrial Intermediates & Infrastructure, which develops
solutions that enable unique properties in manufacturing processes,
infrastructure markets and downstream finished goods. The
technologies in this business unit: deliver innovative solutions
that enable the tapping of oil and gas resources; optimize
manufacturing with additives that minimize friction and heat in
mechanical processes, manage the oil-water interface and facilitate
dissolvability; advance energy efficiency solutions in white goods;
and enable infrastructure material properties through unique
modifiers and additives.
- Packaging & Specialty Plastics, which represents one of the
world's deepest and most differentiated performance plastics
portfolios. The solutions and technologies in this unit: address
consumer and brand owner demand for increased packaging
convenience; reduce food waste; and advance the global development
of telecommunications and electrical transmission and distribution
infrastructure
The intended company will maintain
the Dow™ brand and will be headquartered in Midland, Michigan.
- A leading Specialty Products Company that will be a
customer-driven innovation leader composed of technology-based
differentiated materials, ingredients, and solutions that transform
industries and everyday life. The intended company will apply its
market knowledge and deep expertise in science and application
development to solve customer needs in distinct markets, including
electronics, transportation, building and construction, health and
wellness, food and safety. The intended company will consist of
four market-leading segments:
-
- Electronics & Imaging, the world's largest supplier with
the broadest set of materials and technologies to solve complex
problems for the semiconductor, circuit board, photovoltaic,
display and flexographic printing industries that enable the next
generation of connectivity and functionality, as well as the
convergence of electronic capabilities into everyday life, such as
autonomous and electric vehicles.
- Transportation & Advanced Polymers, an industry leader
providing high-performance engineering resins, adhesives,
lubricants and parts to engineers and designers in the
transportation, electronics and medical markets to enable
integrated materials solutions for demanding applications and
environments.
- Safety & Construction, a global leader and trusted partner
with category-leading, proprietary branded products including
high-performance fibers and foams, aramid papers, non-woven
structures, membranes and filtration technologies and protective
garments serving the construction, worker safety, energy, oil &
gas, transportation, water purification and medical markets.
- Nutrition & Biosciences, a market leader and technology
pioneer collaborating with customers in food, pharma and personal
care markets, utilizing naturally sourced ingredients and
bioscience capabilities, including protein and microbial
engineering and industrial-scale fermentation, to create higher
performing, healthier and more sustainable offerings (such as
probiotics, enzymes, antimicrobial technologies, pharma excipients
and biomaterials).
The intended company will be
headquartered in Wilmington,
Delaware.
Conference Call
The Company will discuss the results of its review and the path
forward during a live webcast call today beginning at 8:30 a.m. ET. Listeners may also join via
telephone at +1.719.325.4910. The slide presentation that
accompanies the conference call will be posted on the DowDuPont
Investor Relations events and presentations page. A replay of the
webcast will also be available on the investor events and
presentations page of www.dow-dupont.com.
About DowDuPont
DowDuPont (NYSE: DWDP) is a holding
company comprised of The Dow Chemical Company and DuPont with the
intent to form strong, independent, publicly traded companies in
agriculture, materials science and specialty products sectors that
will lead their respective industries through productive,
science-based innovation to meet the needs of customers and help
solve global challenges. For more information, please visit us at
www.dow-dupont.com.
Cautionary Statement About Forward-Looking
Statements
This communication contains "forward-looking
statements" within the meaning of the federal securities laws,
including Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended.
In this context, forward-looking statements often address expected
future business and financial performance and financial condition,
and often contain words such as "expect," "anticipate," "intend,"
"plan," "believe," "seek," "see," "will," "would," "target,"
similar expressions, and variations or negatives of these
words.
On Dec. 11, 2015, The Dow Chemical
Company ("Dow") and E. I. du Pont de Nemours and Company ("DuPont")
announced entry into an Agreement and Plan of Merger, as amended on
March 31, 2017, (the "Merger
Agreement") under which the companies would combine in an all-stock
merger of equals transaction (the "Merger Transaction"). Effective
Aug. 31, 2017, the Merger Transaction
was completed and each of Dow and DuPont became subsidiaries of
DowDuPont Inc. ("DowDuPont"). For more information, please see each
of DowDuPont's, Dow's and DuPont's latest annual, quarterly and
current reports on Forms 10-K, 10-Q and 8-K, as the case may be,
and the joint proxy statement/prospectus included in the
registration statement on Form S-4 filed by DowDuPont with the SEC
on March 1, 2016 (File No.
333-209869), as last amended on June 7,
2016, and declared effective by the SEC on June 9, 2016 (the "Registration Statement") in
connection with the Merger Transaction.
Forward-looking statements by their nature address matters that
are, to different degrees, uncertain, including the intended
separation of DowDuPont's agriculture, materials science and
specialty products businesses in one or more tax efficient
transactions on anticipated terms (the "Intended Business
Separations"). Forward-looking statements are not guarantees of
future performance and are based on certain assumptions and
expectations of future events which may not be realized.
Forward-looking statements also involve risks and uncertainties,
many of which are beyond the company's control. Some of the
important factors that could cause DowDuPont's, Dow's or DuPont's
actual results to differ materially from those projected in any
such forward-looking statements include, but are not limited to:
(i) successful integration of the respective agriculture, materials
science and specialty products businesses of Dow and DuPont,
including anticipated tax treatment, unforeseen liabilities, future
capital expenditures, revenues, expenses, earnings, productivity
actions, economic performance, indebtedness, financial condition,
losses, future prospects, business and management strategies for
the management, expansion and growth of the combined operations;
(ii) impact of the divestitures required as a condition to
consummation of the Merger Transaction as well as other conditional
commitments; (iii) achievement of the anticipated synergies by
DowDuPont's agriculture, materials science and specialty products
businesses; (iv) risks associated with the Intended Business
Separations, including those that may result from the comprehensive
portfolio review undertaken by the DowDuPont board, changes and
timing, including a number of conditions which could delay, prevent
or otherwise adversely affect the proposed transactions, including
possible issues or delays in obtaining required regulatory
approvals or clearances related to the Intended Business
Separations, disruptions in the financial markets or other
potential barriers; (v) the risk that disruptions from the Intended
Business Separations will harm DowDuPont's business (either
directly or as conducted by and through Dow or DuPont), including
current plans and operations; (vi) the ability to retain and hire
key personnel; (vii) potential adverse reactions or changes to
business relationships resulting from the completion of the merger
or the Intended Business Separations; (viii) uncertainty as to the
long-term value of DowDuPont common stock; (ix) continued
availability of capital and financing and rating agency actions;
(x) legislative, regulatory and economic developments; (xi)
potential business uncertainty, including changes to existing
business relationships, during the pendency of the Intended
Business Separations that could affect the company's financial
performance and (xii) unpredictability and severity of catastrophic
events, including, but not limited to, acts of terrorism or
outbreak of war or hostilities, as well as management's response to
any of the aforementioned factors. These risks, as well as other
risks associated with the merger and the Intended Business
Separations, are more fully discussed in (1) the Registration
Statement and (2) the current, periodic and annual reports filed
with the SEC by DowDuPont and to the extent incorporated by
reference into the Registration Statement, by Dow and DuPont. While
the list of factors presented here is, and the list of factors
presented in the Registration Statement are, considered
representative, no such list should be considered to be a complete
statement of all potential risks and uncertainties. Unlisted
factors may present significant additional obstacles to the
realization of forward-looking statements. Consequences of material
differences in results as compared with those anticipated in the
forward-looking statements could include, among other things,
business disruption, operational problems, financial loss, legal
liability to third parties and similar risks, any of which could
have a material adverse effect on DowDuPont's, Dow's or DuPont's
consolidated financial condition, results of operations, credit
rating or liquidity. None of DowDuPont, Dow or DuPont assumes any
obligation to publicly provide revisions or updates to any
forward-looking statements regarding the proposed transaction and
intended business separations, whether as a result of new
information, future developments or otherwise, should circumstances
change, except as otherwise required by securities and other
applicable laws.
View original
content:http://www.prnewswire.com/news-releases/dowdupont-announces-results-of-comprehensive-portfolio-review-300517691.html
SOURCE DowDuPont