Dow sheds Styron division, gains new polyol facility
Dow Chemical has announced two big moves in as many days: the company announced the sale of its Styron plastic...
Dow Chemical has announced two big moves in as many days: the company announced the sale of its Styron plastics division to private investment firm Bain Capital for US$1.63 billion on March 2, and signed a business alliance in their polyurethane systems business with E.A. Juffali & Brothers – one of Saudi Arabi’s largest commercial enterprises – on March 3.
For Midland, Mich.-based Dow, the sale to Boston-based Bain Capital is an effort to unload debt. Dow put the Styron division up for sale in July, following a US$16.5 billion buyout of specialty chemicals manufacturer Rohm&Haas.
“This transaction is yet another step in our disciplined approach to portfolio management,” Dow CEO Andrew Liveris said. “We are committed to further focusing our portfolio by shedding non-strategic assets that can no longer compete for growth resources inside the company.”
Dow has an option to receive up to 15 per cent of the equity of Styron as part of the sale consideration, Liveris added.
The alliance between Dow’s Forumulated Systems division and E.A. Juffali & Brothers, meanwhile, will result in the construction of a manufacturing plant for the production of polyol blends in the city of Jeddah, Saudi Arabia.
“This alliance reinforces Dow Formulated Systems’ commitment to our customers and the industries we serve in the Middle East. Our longstanding business relationship with E.A. Juffali & Brothers has offered the conditions for this significant step ahead that further accelerates the implementation of our global business strategy based on our unique, wide and detailed presence, market knowledge and customers intimacy,” said Juan Antonio Merino, general manager of Dow’s Formulated Systems division.
E.A. Juffali & Brothers is recognized as Saudi Arabia’s pioneers in electrical power utilities, construction, insurance, telecommunications, and vehicle manufacturing & distribution. Their joint venture partners include such global firms as Daimler-Benz, DuPont, IBM, Michelin and Siemens AG.