Dow reverses stance, may cut dividend - Liveris

03 February 2009 22:11  [Source: ICIS news]

HOUSTON (ICIS news)--US major Dow Chemical may cut its dividend to preserve its investment-grade rating, CEO Andrew Liveris said on Tuesday, reversing an earlier pledge.

Liveris has previously said that Dow would not cut its dividend under his watch.

However, Liveris made that statement before demand collapsed and credit markets froze in December, he said. That same month, Dow announced a massive amount of layoffs and plant closings.

Dow is now considering another round of plant closings and layoffs, he said.

"December changed everything," Liveris said during an earnings conference call. "It would be foolhardy for us to go back to those pre-December words."

Dow reported a $1.55bn (€1.2bn) net loss for the fourth quarter.

As such, Liveris backed down on his earlier statement.

"We're very respectful of the need to look after the interests of all shareholders," he said.. "And whether that means a dividend cut occurs or not, it would have to be a collection of things that we would look at."

"Right now, I'd be the first to tell you that that is a different statement that I made prior to December, and I acknowledge the reality of the moment," Liveris said.

Dow would also consider raising or selling equity to maintain its rating - although that would not be the company's first choice, Liveris said.

"We are committed, above all else, to maintaining an investment-grade rating and are prepared to take all necessary steps to do so," Liveris said.

($1 = €0.78)

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By: Al Greenwood
+1 713 525 2645

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