Dow Chemical, DuPont Seek EU Regulatory Approval For Their $130 Billion Merger
Feb 10, 2017 08:07 AM EST
Dow Chemical and DuPont seek regulatory approval from European Union Commission for their $130 billion merger plan. Both of them offered to sell their assets to ease the concern from the EU.
The European Commission main concern is the merger between two largest chemical corporation will lead to higher price in herbicides and pesticides according to report from Reuters. Such increase in price will cause trouble to farmers in Europe.
Dow Chemicals and DuPont are the second largest and the fourth largest chemical company in the world. The new company formed as result of the merger which called DowDuPont will be a giant corporation in the chemical industry with the value of $130 billion.
Such giant will have the capability to drive out competition in chemical products and control the price of the product. Therefore, in order to ease the concern, the companies sent concession to European Commission, stating their willingness to sell the companies’ asset in order to gain approval.
Chief Executive Officer of DuPont Edward Breen reiterated the intention in on Wednesday. According to Philadelphia Inquirer, Breen said the DuPont is prepared to divide its pesticide business unit or crop protection in order to get the approval in the merger with Dow Chemical. He also said that research and development unit in pesticide business will also be separated.
DuPont appointed the executive of pesticide business unit Timothy Glenn to elaborate details about separation plan to the employees. He will visit employees in the Wilmington headquarters, the research and development labs in Newark to explain detail plan of the changes.
Merger between the two companies were agreed on Dec. 11, 2015. Following the merger, the new company, DowDuPont company will be split into three public companies with separate products on agricultural chemicals, materials science, and specialty product industries. Watch the report from Wall Street Journal regarding the merge of Dow Chemicals and DuPont which later to be split into three separate companies below: