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  • Yesterday, 10:45 AM
    • Dow Chemical (DOW -0.2%) CEO Andrew Liveris says the merger with DuPont (DD -0.6%) may be delayed until February from a planned closing late this year.
    • Agriculture is the greatest concern of European regulators, Liveris tells Bloomberg: “One of the strongest lobbies in the world out there is the farm lobby, and in Europe, the agricultural sector is very, very critical to them, somewhat protected."
    • The European Commission recently delayed its decision deadline until Feb. 6 as it sought additional information about the merger, but Liveris says the value created by the deal is "worth a few months of delay."
    • The CEO does not say whether the companies planned to sell assets to help win approval, although reports have indicated that Dow is seeking a buyer for its copolymers business and DuPont is planning to sell a herbicides business to ease regulators’ concerns.
    • In its Q3 earnings report, DuPont CEO Ed Breen said he expects the merger to close sometime during Q1 2017.
    | Yesterday, 10:45 AM | 6 Comments
  • Yesterday, 8:24 AM
    • DuPont (NYSE:DD) +0.8% premarket after reporting better than expected Q3 earnings and revenues, and raises its FY 2016 earnings guidance.
    • DD says it now sees full-year EPS coming in at $3.25, compared with its prior guidance range of $3.15-$3.20 and analyst consensus estimate of $3.20.
    • Q3 total sales rose 1% Y/Y to $4.92B, agriculture sales rose 2% to $1.12B, and sales from performance materials also increased 2% to $1.33B; both segments were helped by 4% higher volume.
    • Savings from DD's cost cutting plan helped boost pretax profit margin in the company’s six business segments by 3.5 percentage points, with gains realized in each one.
    • On the planned merger with Dow Chemical (NYSE:DOW), CEO Ed Breen says "in the event that [EU] regulators in those jurisdictions use their full allotted time, closing would be expected to occur in the first quarter of 2017."
    | Yesterday, 8:24 AM
  • Wed, Oct. 19, 1:56 PM
    • DuPont (DD +0.4%) is initiated with a Buy rating and $78 price target at Nomura, which expects strong earnings potential from the proposed combination with Dow Chemical (DOW +0.6%).
    • Nomura expects the DuPont-Dow merger to generate above-trend growth in earnings and free cash flow for the next three years, which it considers "exceptional in a macro environment where growth is scarce."
    • DuPont management’s integration plan through 2019, which centers on aggressive cost cuts and assets spinoffs and sales, makes the shares especially compelling, the firm says, estimating the moves should result in equity value compounding at 16% annually during 2017-19.
    | Wed, Oct. 19, 1:56 PM | 13 Comments
  • Tue, Oct. 18, 8:27 AM
    • BASF (OTCQX:BASFY) faces a prolonged shutdown of production units at its chemical plant complex and headquarters in Ludwigshafen, Germany, where yesterday's explosion and fire killed two employees and injured dozens.
    • BASF says two steam crackers at the plant remain halted and another 20 facilities are either stopped or only partially working.
    • Analysts say some production units could be down for months as investigations by the company and government agencies take place, possibly tightening European ethylene markets in 2017, which could benefit Dow Chemical (NYSE:DOW) and LyondellBasell Industries (NYSE:LYB).
    • Baader Bank analyst Markus Mayer says the closing of the two steam crackers mostly will impact BASF's basic chemicals division, which makes up ~21% of sales and 30% of EBITDA; he analyst estimates that 6% of annual earnings could be directly impacted by the fire, with as much as 3% of EBITDA at risk because the shutdown may last more than a quarter.
    | Tue, Oct. 18, 8:27 AM | 1 Comment
  • Mon, Oct. 10, 2:31 PM
    • Dow Chemical (DOW +0.8%) is upgraded to Buy from Neutral with a $62 price target, raised from $53, at UBS, which believes the merger with DuPont (DD +0.6%) could gain regulatory approval and that the stock is now too cheap to ignore.
    • The firm already factors in $3B in potential cost savings from the deal but now substantially raises its free cash flow estimates in the materials to reflect ~20% decline in capex from pro forma 2016-18.
    • UBS also revisits its sum-of-the-parts estimate based on the valuation of each spinoff company likely to come out of the combined new company to reflect a more comprehensive peer set, which it uses to benchmark vs. the S&P 500.
    | Mon, Oct. 10, 2:31 PM | 18 Comments
  • Mon, Oct. 3, 2:18 PM
    • Dow Chemical (DOW +1.6%) and DuPont (DD +1.8%) are both upgraded to Buy from Neutral at Citigroup, which calls the combined company "the stock to own in 2017" if their merger deal is completed.
    • Citi cites the companies' "massive" cost-cutting opportunity after the merger goes through as well as the potential for upside to the stated $3B synergy target; from the split-up lean and agile companies, the firm expects an incremental $1B synergy above the companies' target, adding $0.30/share to proforma combined earnings.
    • The firm raises its price target on Dow to $59 from $55 and on DD to $76 from $72.
    | Mon, Oct. 3, 2:18 PM | 17 Comments
  • Mon, Oct. 3, 8:14 AM
    • The European Commission have resumed their investigation into the $130B merger of Dow Chemical (NYSE:DOW) and DuPont (NYSE:DD) after the companies provided key data, and will decide by Feb. 6 whether to approve the deal, Reuters reports.
    • The EU antitrust regulator opened a full investigation into the case in August, concerned that the deal could reduce competition in crop protection, seeds and certain petrochemicals.
    | Mon, Oct. 3, 8:14 AM | 12 Comments
  • Tue, Sep. 27, 2:28 PM
    • The petrochemical joint venture between Dow Chemical (DOW +0.7%) and Kuwait's state-owned Equate Petrochemical has hired banks for a potential bond issue of as much as $3B, Bloomberg reports.
    • Lenders including HSBC Holdings, NBK Capital, JPMorgan Chase and Citigroup are arranging the sale of dollar-denominated securities, according to the report.
    • Equate raised $5B via a loan in June and last year borrowed a $6B bridge loan to acquire MEGlobal from Dow.
    | Tue, Sep. 27, 2:28 PM | 1 Comment
  • Wed, Sep. 21, 2:54 PM
    • German lawmakers lashed out in skepticism today at Bayer's (OTCPK:BAYRY -0.9%) planned takeover of Monsanto (MON +1.1%) in a meeting of parliament that highlighted the backlash Bayer faces in its home market against buying a company that many Germans see as a champion of genetically modified crops.
    • Eight of the 12 lawmakers who spoke, including three members from within Chancellor Merkel’s coalition, criticized the deal; the lawmakers have no legislative authority to stop the deal, but some are calling on regulators to do so.
    • The deal also drew scrutiny at the U.S. Senate Judiciary Committee yesterday, where Sen. Grassley said the deal was part of a "tsunami of consolidation" that could reduce choice and raise the price of chemicals and seed for farmers, which ultimately would affect choice and costs for consumers.
    • Company execs - including some from DuPont (DD +0.4%), Dow Chemical (DOW -0.1%) and Syngenta (SYT +0.2%) - sought to allay concerns and reassure lawmakers that they would keep licensing new types of seeds to smaller companies.
    | Wed, Sep. 21, 2:54 PM | 30 Comments
  • Wed, Sep. 21, 11:20 AM
    | Wed, Sep. 21, 11:20 AM | 45 Comments
  • Fri, Sep. 9, 7:36 AM
    • The European Commission has halted its scrutiny of Dow Chemical (NYSE:DOW) and DuPont's (NYSE:DD) proposed merger while the companies provide more information regarding their $130B deal.
    • Once the data is received, the antitrust enforcer will set a new deadline for its investigation.
    • The two companies, which aim to close the deal in early 2017, had previously offered concessions which regulators said were insufficient.
    | Fri, Sep. 9, 7:36 AM | 18 Comments
  • Thu, Sep. 8, 8:04 AM
    • Dow Chemical (NYSE:DOW) declares $0.46/share quarterly dividend, in line with previous.
    • Forward yield 3.41%
    • Payable Oct. 28; for shareholders of record Sept. 30; ex-div Sept. 28.
    | Thu, Sep. 8, 8:04 AM
  • Wed, Aug. 31, 4:56 PM
    • The issue, according to analysis by Yale's Yair Listokin, is that the stock rarely seems to ever close above $53.72 - just seven times since April 2014 despite a range from the low-$40s to low-$50s. This compares to more than 50 closes at just below $53.72, and a full 91 closes from $52.71-$53.71.
    • Why is this important? Dow Chemical (NYSE:DOW) has the option to buy back $3B worth of preferred shares from Berkshire Hathaway (BRK.A, BRK.B) only if the stock closes above $53.72 enough times. Some executives at Dow believe a short seller keeps knocking it back, and they've got fuel for that argument from Listokin.
    • “The probability that this would happen by chance is essentially zero ... [it's] pretty clear evidence of manipulation," he says.
    | Wed, Aug. 31, 4:56 PM | 86 Comments
  • Fri, Aug. 26, 9:42 AM
    • Major international seed companies Monsanto (NYSE:MON), Bayer (OTCPK:BAYRY), Dow Chemical (NYSE:DOW), DuPont (NYSE:DD) and Syngenta (NYSE:SYT) form an alliance to oppose the Indian government's proposal that would force them to share their genetically modified crop technology with local players.
    • A Bayer exec says no one would invest in research if the proposed introduction of compulsory licensing - which would force a company to share its intellectual property upon government request - is implemented.
    • The show of solidarity comes after MON, which pioneered the use of GM cotton in India, withdrew an application for its next-generation product from the approvals process on concerns over the security of its intellectual property.
    | Fri, Aug. 26, 9:42 AM | 25 Comments
  • Wed, Aug. 24, 6:56 PM
    • The stock market's recent rise has boosted holdings in Berkshire Hathaway’s (BRK.A, BRK.B) portfolio, but the rally in Dow Chemical (NYSE:DOW) has put that company's $255M in annual dividend payments to BRK at risk, Dow Jones reports.
    • Since BRK lent Dow $3B in 2009 to help finance an acquisition, Dow has been on the hook for paying an 8.5% annual dividend on 3M preferred shares, but the deal has an escape hatch: If Dow's shares exceed $53.72 for at least 20 trading days in a 30-day period, Dow can convert BRK's preferred shares into common shares, which do not pay out special dividends.
    • Dow's failure to stay above the $53.72 for long - despite improved earnings and margins, cost cuts, asset sales, an activist shareholder who shook up the board, and a potential merger with DuPont - has fueled speculation that BRK or Warren Buffett are shorting Dow to pressure the stock and avoid triggering the conversion.
    • Although short interest in Dow is down for the year and dropped to $600M at the end of July, short sellers have increased their positions by nearly $100M in August, according to financial analytics firm S3 Partners.
    | Wed, Aug. 24, 6:56 PM | 40 Comments
  • Tue, Aug. 23, 5:56 PM
    • The U.S. Senate Judiciary Committee announces plans to hold a hearing in late September to discuss the mergers of Dow Chemical (NYSE:DOW) and DuPont (NYSE:DD) as well as ChemChina's purchase of Syngenta (NYSE:SYT).
    • Committee chair Sen. Grassley of Iowa has expressed concern that the deals would result in farmers paying more for seeds, pesticides and herbicides and reduce the companies' incentives to innovate.
    • The committee has no formal say over whether the deals may go forward; the Justice Department is reviewing the Dow-DuPont merger, while the FTC is looking at ChemChina's purchase of Syngenta.
    | Tue, Aug. 23, 5:56 PM | 28 Comments