Monday, April 9, 2007

The Rumor(s) That Won’t Go Away

By ROB WESTERVELT (Editor, Chemical Week)
Dow Chemical is the subject of speculative frenzy again after the British tabloid Sunday Express reported yesterday that a group of Middle East investors and U.S. buyout firms was preparing a $50-billion takeover bid for the company. The same paper reported two months ago that a buyout bid for Dow Chemical was imminent.
Dow chairman and CEO Andrew Liveris tried to squelch such reports last month at the BB&T Manufacturing & Materials Conference in New York, asking investors to reject fantastical reports emanating from the “third-rate press.” CW could fill an issue with the rumors and speculation that we’ve picked up about Dow Chemical in the past three months. Reports of an imminent leveraged buyout (LBO) or basic chemical sale or jv have come and gone in recent weeks. The speculation is being fueled by Dow’s low stock price and the amount of cash it generates. Those figures have caught the attention of any investor with the wherewithal to pull off a deal in the $50-billion range. Private equity may be knocking but Dow hasn’t answered yet. And it doesn’t appear likely that Dow management is willing to put the company in play for a bid in the 50's/share range.

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