UPDATE:FTC OKs Dow Chem Deal For Rohm & Haas,With Conditions
January 23 2009 - 11:41AM
Dow Jones News
The U.S. Federal Trade Commission on Friday gave antitrust
clearance to Dow Chemical Co.'s (DOW) $18.8 billion acquisition of
rival chemical manufacturer Rohm & Haas Co. (ROH), but required
Dow to sell assets for the deal to go through.
Under a settlement with the FTC, Dow agreed to sell its acrylic
monomer, hollow sphere particle and acrylic latex polymer
businesses.
Dow also agreed to put procedures in place to ensure it doesn't
have access to competitively sensitive non-public information
regarding any businesses it acquires from Rohm & Haas.
The FTC said in a statement that Dow's concessions were
necessary because the companies are direct and significant
competitors in certain markets for acrylics and other industrial
chemicals used to make coated paper products, paints and
adhesives.
The settlement would ensure competition in those areas and keep
consumers from seeing higher prices, the commission said.
The FTC said Dow has to sell the assets within 180 days from the
acquisition date of Rohm, or within 240 days from when Friday's
settlement is accepted for public comment, whichever comes later.
If Dow does not sell the assets in that time, a
commission-appointed trustee may do so, the FTC said.
Friday's FTC announcement puts pressure on Dow to close a deal
that has been criticized as expensive and risky in the current
economic climate.
The company has faced questions of whether it will be able to
complete the Rohm & Haas deal after a major joint venture with
Kuwaiti state-owned company Petrochemical Industries Inc. fell
through. Dow had planned to use cash from the joint venture to fund
the Rohm purchase.
A Dow spokesperson did not immediately return a call for
comment.
-By Brent Kendall, Dow Jones Newswires; 202-862-9222;
brent.kendall@dowjones.com
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