Foresight, and long-term relationships, have paid off for Dow.
Yesterday, CEO Andrew Liveris announced that a binding agreement has now been signed with Kuwait's PIC to form K-Dow Petrochemicals. PIC will pay $2bn less for their stake than originally agreed a year ago. This represents an exceptionally good outcome for Dow, given what has happened in world financial and petchem markets since then. It is also a major success for PIC, who now become a leading industry player. As the blog forecast last year, MEGlobal and Equipolymers will become part of K-Dow, taking its sales to $15bn.
Liveris and the Dow Board showed great foresight in creating the deal whilst the industry was still enjoying reasonable times. Equally, they would never have been able to conclude it, during the current meltdown, without the high level of trust developed between PIC and Dow, since the latter inherited the original Equate JV in 2001.
The blog congratulates those concerned for their ability to remain focused on the bigger picture, through all that has gone on in recent months.