Dow could defer Rohm & Haas acquisition to raise cash to complete the deal

08-Jan-09
Dow Chemical Co. could miss its deadline to wrap up the US$15 bln takeover of Rohm & Haas scheduled for next week, in an effort to raise enough cash to complete the deal without taking on too much debt. Dow seems to be in readiness to pay the the penalty for missing Monday's deadline for the closure of the Rohm & Haas takeover. The original agreement, signed in July, contains a "ticking fee" that requires Dow to pay around $100m more for every month of delay in closing the transaction. Dow had planned to use proceeds from a proposed JV with Kuwait's Petrochemical Industries Co to repay a large part of the debt financing for the Rohm & Haas acquisition. The company is to initiate legal action against PIC for backing out of the proposed JV and is scouting for new partners.
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