MIDLAND, MI - The Dow Chemical Co. has completed its acquisition of Rohm and Haas and has sold Morton Salt, Rohm and Haas’ salt business, to a German company.

 

The acquisition of Rohm and Haas is a major step in Dow’s strategy of growing its performance products and specialty portfolio to deliver more consistent earnings growth. Combining the two organizations’ technologies, broad geographic reach and strong market channels will create a $14.0 billion diversified business portfolio, which will be called Dow’s Advanced Materials division. The division is intended to achieve $3.0 billion in additional value growth opportunities, as well as annual cost synergies of $1.3 billion.

 

Pierre Brondeau has been named President and CEO of the new Advanced Materials division, which includes Coatings, Building and Construction, Specialty Materials, Adhesives and Functional Polymers, and Electronic Materials.

 

Dow has decided to exercise its option to have the Haas Family Trusts make an additional $500 million investment in Dow equity. This is consistent with Dow’s plan to retire the bridge loan for the financing of the Rohm and Haas transaction by the end of 2009, which will be accomplished through the sale of assets, issuance of equity and debt, and the previously announced reduction in the company’s dividend to preserve cash.

 

Under the terms of that agreement, Dow is required to divest the following businesses: Clear Lake, Texas, acrylic acid and esters plant and the related glacial acrylic acid, butyl acrylate, and ethyl acrylate businesses in North, Central, and South America; UCAR Emulsion Systems specialty latex businesses in North America; and North American hollow plastic pigment business (also referred to as the hollow sphere particle business). Dow has been actively seeking buyers for the impacted businesses.

 

Morton International Inc., the salt business of Rohm and Haas, was sold to K+S Aktiengesellschaft, Kassel, Germany. K+S is one of the world's leading suppliers of specialty and standard fertilizers, plant care and salt products, and a German DAX 30 company.

 

“We are pleased that we reached an agreement with K+S at an attractive value in such a short period of time," said Dow Chairman and CEO, Andrew N. Liveris. "This sale puts us ahead of schedule on our de-leveraging plan post the close of the Rohm and Haas acquisition. It is the first of many steps designed to deliver on our clear and measurable plan to build value for our shareholders.”