12 April 2007 18:09 [Source: ICIS news]
NEW YORK (ICIS news)--Dow Chemical’s firing of two executives for “unauthorised discussions with third parties about the potential acquisition of the company” makes it unlikely Dow will be acquired in the near term, said Deutsche Bank on Thursday.
“Today’s action reaffirms my belief that an acquisition of Dow is unlikely,” said Deutsche Bank analyst David Begleiter in an interview with ICIS. “CEO [chief executive officer] Andrew Liveris has drawn a line in the sand that he is opposed to a deal. An approach would have to be hostile at this point.”
Dow said earlier in the week that it was not in sale discussions with private equity firms and that a break-up of the company would not be in the best interests of shareholders.
“The door is never completely shut to a deal,” added Begleiter. “However, regarding the reports that ?xml:namespace>
On Thursday, the company sacked Pedro Reinhard, a senior adviser and member of the board, and Romeo Kreinberg, an officer of the company, for having unauthorised discussions on the sale of the company.
Reinhard has not stepped down from the board. Only shareholders can remove board members.
“I have no doubt that these executives thought they were acting in the best interests of Dow shareholders,” said Begleiter. “They’ve spent their entire careers at Dow and I couldn’t imagine they would do anything to hurt the company. But clearly they were not authorised to have these discussions.”
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