23 January 2009 17:55 [Source: ICIS news]
The approval comes as Dow and the FTC reached an agreement about FTC concerns that the merged company would be anticompetitive and violate federal law, the regulator said in a statement.
As such, Dow agreed to sell several of its businesses to a buyer that the FTC will approve. Those businesses include Dow's acrylic monomer, hollow-sphere particle and acrylic latex polymer operations.
Assets to be sold include the following:
The FTC had voiced concerns that the Dow deal would reduce competition in the North American markets for acrylic acid (AA), butyl acrylate (butyl-A), ethyl acrylate (ethyl-A) and other acrylics, the commission said.
The merger could also reduce competition in the markets for hollow-sphere particles and acrylic latex polymers used in traffic paint, the FTC said.
Without the divestments, the company's market share for acrylic acid would exceed 40%, the FTC said. Butyl acrylate would be nearly 75% and ethyl acrylate would be almost 90%.
The combined would have a monopoly in hollow sphere particles and acrylic latex polymer for traffic paint, the FTC said.Already, Dow has hired JP Morgan to advise it on the possible sale of its acrylic acid and esters operations - as well as its North American UCAR emulsion systems specialty latex business.
Dow's Rohm and Haas deal has already received approval from the European Commission.
Although Dow has received regulatory approval for the deal, the merger is still facing strain after another Dow deal fell through.
Under that separate deal, Dow would have established the K-Dow Petrochemicals joint venture with Petrochemical Industries Co (PIC) of Kuwait. Had the joint venture closed, Dow would have received $7.5bn in cash from PIC and a $1.5bn cash distribution from K-Dow.
Dow's offer for Rohm and Haas comes to $78/share.
As of 12:22 hours New York time (17:22 GMT), Rohm and Haas shares were trading at $62.36, up 3.14%. Dow shares were trading at $14.15, down 1.6%
($1 = €0.77)
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