Dow and KPIC subsidiary plan 50:50 joint venture

The Dow Chemical Company (Dow) and Petrochemical Industries Company (PIC) of the State of Kuwait, a wholly owned subsidiary of Kuwait Petroleum Corporation (KPC), have announced plans to form a 50:50 joint venture to form a global petrochemicals company. The joint venture, to be headquartered in the United States, will manufacture and market polyethylene, ethylenamines, ethanolamines, polypropylene and polycarbonate. The transaction is anticipated to close in late 2008, after being subjected to completion of definitive agreements, customary conditions and regulatory approvals. The new venture is being positioned, since inception, as an US$11 billion company that is well positioned to grow profitably across the industry cycle. This marks an important milestone for Dow's transformational strategy of growing its Basics businesses through joint ventures; reducing capital intensity; and freeing up cash to invest in Performance and Market Facing businesses. The new venture will build upon PIC's feedstock position and commitment to global petrochemicals growth, KPC's position as one of the world's top ten energy/hydrocarbons companies, and Dow's technology and market leadership - including its number one position in polyethylene, ethyleneamines and ethanolamines. To form the new company, Dow will sell to PIC a 50% interest in the business assets included in the transaction. In turn, both PIC and Dow will place their share of the assets into the joint venture, with each party then taking a 50% equity interest in the new company. The value of the five Dow global businesses that will form the joint venture is approximately US$19 bln. Dow will receive approximately US$9.5 bln (pre- tax) from PIC for the 50% interest.
  More News  Post Your Comment
{{comment.Name}} made a post.




There are no comments to display. Be the first one to comment!


Name Required.


Email Id Required.

Email Id Not Valid.


Mobile Required.

Email ID and Mobile Number are kept private and will not be shown publicly.

Message Required.

Click to Change image  Refresh Captcha