The chemical and agricultural industries are seeing a mega-merger; Dow Chemical (NYSE:DOW) and DuPont (NYSE:DD) announced Friday a deal valued at $130 billion.
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During an interview on FOX Business Network’s Countdown to the Closing Bell, DuPont CEO Edward Breen and Dow Chemical CEO Andrew Liveris discussed the impact of the deal.
“It’s a very unique deal,” Liveris said. “It’s a merge and spin model where we’ve already pre-determined the businesses coming out, so this is not a scale issue in the traditional regulator/Department of Justice sense. Of course, we are going to go through the regulator and get all the things that need to be done.”
Breen said investors are happy with the move.
“Andrew [Liveris] and I have been talking to our investors all day today,” he said. “Most of our big ones we’ve talked to and they love the deal. They understand the industrial logic to the deal and they understand the value we’re going to create.”
He added: “This [the merger] is going to make us the global leader in the business. Secondly, we’re going to have the broadest and most diverse portfolio for our customer, the farmer. That’s very important from a market share standpoint. We have talked to our investors about taking $1.3 billion of cost out of the combo in the ag business, yet we will have a real powerhouse of an R&D machine in that business, so that will really help the profitability of this business very significantly.”