Dow puts debt problems behind it

Dow right.jpgA year ago, the Dow Chemical stock price was below $6, giving the company a total market capitalisation of just c$7bn.

Since then, Dow has regained the initiative in a very focused way.

First, it sold Morton Salt for $1.7bn, then it sold $2.25bn of new equity and refinanced $4.65bn of long-term debt. Next, it sold the calcium chloride and refining businesses for $925m. And now Tuesday saw the disposal of the Styron business to Bain for $1.63bn. Plus Dow puts a $400m value on the long-term supply/purchase deals attached to the sale.

The stock price has, of course, responded to these successes. It is now trading at c$29, giving a market capitalisation of $33bn. The blog congratulates those responsible in Dow for this major turnaround, at a time when market conditions have remained difficult.

About Paul Hodges

Paul Hodges is Chairman of International eChem, trusted commercial advisers to the global chemical industry. Paul is also an invited member of the World Economic Forum’s Global Agenda Council. The aim of this blog is to share ideas about the influences that may shape the chemical industry over the next 12 – 18 months. It will try to look behind today’s headlines, to understand what may happen next in important issues such as oil prices, economic growth and the environment. We may also have some fun, investigating a few of the more offbeat events that take place from time to time. Please do join me and share your thoughts. Between us, we will hopefully develop useful insights into the key factors that will drive the industry's future performance.

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