Kuwait parliament votes to probe Dow-PIC deal - reports

27 January 2009 22:21  [Source: ICIS news]

TORONTO (ICIS news)--Kuwait’s parliament voted on Tuesday to set up a panel to investigate the K-Dow petrochemicals joint-venture deal between Dow Chemical and the country’s Petrochemicals Industries Co (PIC) that was later cancelled, regional media reported on Tuesday.

The panel would investigate allegations of profiteering and other irregularities by officials involved in the deal, Kuwait's Al Watan newspaper and other media reported.

Under the deal, Dow would have received $7.5bn from PIC. Kuwait cancelled the deal in late December, citing unfavourable economic conditions and the global financial crisis.

A media official at Dow’s headquarter in Midland, Michigan, was not immediately available for comment.

Dow chief executive Andrew Liveris, in an interview with US business channel CNBC earlier on Tuesday, called Kuwait’s cancellation of the PIC deal “an unparalleled, stunning reversal by a sovereign nation.”

He confirmed that Dow had taken legal steps against Kuwait to seek compensation.

Liveris also said that, should the deal with PIC close after all or if another partner came forward, Dow for its part would be able close its acquisition of US specialty chemicals producer Rohm and Haas.

In the current tough financial market environment, however, it would be “an economic disaster” for both companies to put Dow Chemical and Rohm and Haas together, Liveris said.

He expressed his hope that the deal may be concluded at a later but unspecified date.

Rohm and Haas said on Monday it had taken legal action against Dow for failing to close the deal.

For more on Dow Chemical and Rohm and Haas visit ICIS company intelligence
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By: Stefan Baumgarten
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