Dow Chemical shares slide after LBO denial

10 April 2007 16:15  [Source: ICIS news]

TORONTO (ICIS news)--Shares of Dow Chemical fell by 2.29% in early Tuesday morning trading after the company late on Monday dismissed media speculation that a $50.0bn (€37.5bn) leveraged buyout was imminent.

 

Dow’s shares were priced at $45.56/share. The stock had gained 4.86% on Monday to reach $46.63/share.

 

Analysts at Buckingham Research said Dow’s share price – up 17% year-to-date at Monday's closing, including the day’s rumour-driven jump – would likely pull back, but it may not give back all of its recent gains.

 

The rise at Dow came on the back of a broad upward movement of some key chemical and industrial shares, Buckingham said.

 

As per Monday’s closing, Nova Chemicals’ was up 13% year-to-date and PPG 12%. Other large industrial firms also saw there share prices rise, the analysts said. Alcoa was up 16% and International Paper up 9%.

 

“So Dow’s rumour-driven rally has coincided with upward movements in a broad set of chemical and industrial stocks, leaving Dow’s performance as less remarkable,” Buckingham said.

 

Separately, Dow announced earlier on Monday plans for a styrenics joint venture with Chevron Phillips Chemical.

 

($1 = €0.75)

By: Stefan Baumgarten
+1 713 525 2653

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