Shareholders Approve Dow-DuPont Merger
In separate meetings at the respective corporate headquarters, shareholders of US chemical giants DuPont and Dow have approved the mega merger of the two companies announced in December of last year. The combination into a new entity called DowDuPont will precede a breakup into three separate companies focused on agriculture, specialty products and materials and scheduled to take place by 2018.
The first two companies, with pro forma sales of $19 billion and $13 billion respectively, will be based in Delaware, where DuPont is based, the third, with sales of $51 billion, at Dow’s Midland, Michigan, main site. According to a regulatory filing, nearly 825 million Dow shareholder voted for the merger roughly 11 million voted against it and 10.7 million abstained. According to a recent estimate, the company has 1.13 billion outstanding shares outstanding.
DuPont said 98.29% of shares voted at the company’s special meeting supported approval. The Delaware company is estimated to have 874 million shares outstanding. The two sides hope to close the transaction in the second half of the year, if anti-trust authorities approve in time. In February, the US Justice Department issued a second request for information on the merger and launching an in-depth probe.
Dow and DuPont notified China’s competition agency in May and filed with the European Commission in June. The EU antitrust authority is due to decide by July 28 whether to allow the merger. However, it can extend the deadline by a further 35 working days and can also open an in-depth investigation lasting up to 105 days if it has serious concerns about the deal’s impact on competition.
The US giants’ merger into one entity before the split is designed to give the companies time to streamline operations, in particular closing plants and laying off personnel. Following the Jul. 20 shareholder vote, DuPont CEO Ed Breen said the merger partners have begun looking at where to make $3 billion in cuts.