The Dow Chemical Co. (Dow) informed Rohm and Haas Co. that Dow would not close on the proposed acquisition of Rohm and Haas as scheduled on Jan. 27, 2009. In response to Dow’s announcement, Rohm and Haas has filed suit in a Delaware court, asking a judge to order Dow to complete the takeover.

MIDLAND, MI/PHILADELPHIA – The Dow Chemical Co. (Dow) informed Rohm and Haas Co. that Dow would not close on the proposed acquisition of Rohm and Haas as scheduled on Jan. 27, 2009. In response to Dow’s announcement, Rohm and Haas has filed suit in a Delaware court, asking a judge to order Dow to complete the takeover.

The feasibility of the deal came into question following the Kuwait government’s decision in late December 2008 to terminate a planned joint venture – known as K-Dow Petro-chemicals (K-Dow) – between Dow and a Kuwaiti company. The deal was worth an estimated $17.4 billion and was part of Dow’s strategy to increase its exposure in the specialty chemicals business.

Rohm and Haas claims that the failure of the K-Dow venture does not provide Dow with a basis for refusing to close, and that Dow has the resources and flexibility to live up to its obligations under the merger agreement. Dow has filed an argument with the court claiming that to go forward with the deal in the current credit environment could cause irreparable harm to both companies.