The world might never have had products like Ziploc bags or Saran wrap, Teflon coatings, Nylon and Kevlar fibers had it not been for Dow Chemical, Midland, Mich., and DuPont, Wilmington, Del. Shareholders for the two chemical and ag companies have now approved their merger. After the deal is finalized, the century-old companies plan to break up into three parts within about two years. One company will focus on agriculture, one on material science and one will produce and sell specialty products.
Holding meetings took place where shareholders voted on the move, and the companies were reportedly pressured by investors to break up or find other ways to boost their businesses. They agreed to merge in December in an all-stock deal valued at approximately $62 billion.
In April, Dow's chairman and CEO Andrew Liveris pointed out that the chiefs of the three divisions of the merged company, which would be called DowDuPont, wouldn’t automatically become CEOs of the three planned public entities.
Appointments they have settled on include Dow's chief financial officer Howard Ungerleider being named DowDuPont’s finance chief. Dow's COO Jim Fitterling has been named operating chief of the merged company’s materials business and James C. Collins Jr., who currently leads DuPont’s agriculture business, will serve as operating chief of DowDupont's agriculture division. Marc Doyle was named COO of DowDuPont’s specialty products business. Doyle presently leads DuPont’s Electronics & Communications, Industrial Biosciences, Nutrition & Health, Performance Materials and Safety and Protection businesses.
These assignments would go into effect once the deal closes, which is expected to be later this year. But as they prepare to combine, the two firms have been eliminating staff and closing facilities. In June, Dow Chemical said it would eliminate 2,500 jobs after spending $48 billion to take control of Dow Corning from Corning Inc., which makes silicone products, ending a 72-year-old joint venture.
The cuts should reduce the chemical giant’s workforce by roughly 4 percent, and there are plans to close Dow's silicone factories in Greensboro, NC and Yamakita, Japan, as well as other administrative, corporate and manufacturing facilities. DuPont is laying off about 10 percent of its staff worldwide and also spun off its performance chemicals business into a separate company called Chemours last year. Dow also sold its AgroFresh specialty chemical business and most of its chlorine business.
Most recently, DuPont and Dow have concentrated on their agriculture businesses because of the growing demand globally for food supplies. This, in turn, boosted sales of GMO-engineered seeds, fertilizer, herbicides and pesticides.