DuPont CEO tells workers he may split some pesticides to get Dow deal past Europe
"May be enough to win approval" for Dow-DuPont deal
DuPont chief executive Edward Breen said the company has told European regulators that it is prepared to separate some of its crop protection (pesticides) units and supporting research and development from the rest of the Wilmington-based chemical giant, to gain European approval of its planned $75 billion merger with Dow Chemical Co.
"European Union competition commissioner Margrethe Vestager quickly indicated that the commitments may be enough to win approval," Bloomberg LP reported. The Europeans have been worried that Dow-DuPont and other pesticide mergers will eliminate competition and push prices up. "It is a signal," that "these remedies might work," she said of DuPont's proposal, to reporters in Brussels on Wednesday morning.
DuPont crop protection executive Timothy Glenn was expected to give the employees more details later Wednesday as the staff at the company's Wilmington headquarters, R&D labs in Newark, Del., and in the Midwest prepare for pending job cuts; factory, warehouse, and contractor consolidation; and manager changes.
Philadelphia-based FMC, Monsanto, and European and Asian companies are potential buyers of DuPont's crop pesticide business if it is spun off.
"Dow and DuPont continue to engage constructively with the European Commission and other regulators in all relevant jurisdictions to obtain clearance for the merger, which we are confident will be achieved," the company said in a statement released by spokesman Daniel Turner.
"As part of this process, we have submitted a remedy package to the European Commission that maintains the strategic logic and value creation potential of the transaction for all stakeholders.
"The remedies include proposed divestment of a portion of DuPont's crop protection business and associated research and development, as well as Dow's acid copolymers and ionomers business."
In connection with the proposal, "the European Commission deadline for review has been extended until April 4," but that shouldn't stop Dow and DuPont from merging under their previously revised schedule, "in the first half of 2017 with the intended [spin-offs of Dow-DuPont into separate farm, materials, and specialty companies] to occur about 18 months after closing."