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Dow Chemical and DuPont Plan Huge Merger Followed By a Split (nytimes.com)
An anonymous reader writes: Two of the largest and oldest chemical companies, Dow and DuPont, have planned a merger. Dow's 53,000 employees will join forces with DuPont's 63,000 employees, which will challenge Germany's BASF for the biggest chemical company in the world. Not for long, though — once the merger is complete, they will split up into three. One will focus on agriculture, one on materials science, and one on specialty products. According to the press release, it will indeed be a merger of equals, with both companies comprising 50% of the new DowDuPont behemoth. "Despite the eventual breakup, the deal would undergo rigorous antitrust scrutiny for all three companies, particularly the agricultural chemicals company. Still, the companies did not expect that the deal would require much in the way of other divestitures to satisfy regulators' concerns."
Between me, my father, and my brother, we own over $100k in stock in these two companies.
I worked as a network engineer/contractor near 2001 for Dow when they were merging with Cargill - trying to mix an OSPF and ISIS network and they ran DecNet - good times
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10% of the total staff will face the axe as well..
Of course execs and shareholders will make out like bandits. Or would that be "robber barons"?
Teddy would be turning over in his grave...
ELOI, ELOI, LAMA SABACHTHANI!?
Once they spit the new companies will be named Dow Du and Pont.
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Once the two are combined, they plan to split into three separate companies, consisting of agricultural chemicals, specialty products and materials, like plastics.
Despite the eventual breakup, the deal would undergo rigorous antitrust scrutiny for all three companies, particularly the agricultural chemicals company. Still, the companies did not expect that the deal would require much in the way of other divestitures to satisfy regulators’ concerns.
So, they plan to combine two competing companies into one and then divide into three non-competing companies and they expect this to satisfy regulators? Are the regulators that corrupt?
Are the regulators that corrupt?
Kind of a silly question, no?
“He’s not deformed, he’s just drunk!”
we've been either stacking our regulatory bodies with captured folks or just plain not funding regulation for decades. We don't like small, local corruption (like being shaken down for money by cops or having your mail stolen) but we ignore big stuff like this. When I point it out to people they just don't believe it's real. I get the same when I point out that the Safety Net was dismantled in the 90s... :(
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So, they plan to combine two competing companies into one and then divide into three non-competing companies and they expect this to satisfy regulators? Are the regulators that corrupt?
That's a rhetorical question, right?
The world's burning. Moped Jesus spotted on I50. Details at 11.
Why would the three companies have to compete with each other? There are other very large companies in those businesses.
Are the regulators that corrupt?
More.
But now is your chance folks, file every protest you can. Make objections. It won't change anything except the amount of bribes, but still, that is worth it.
Always has been the job of chemical companies, and always will be.
Once the two are combined, they plan to split into three separate companies, consisting of agricultural chemicals, specialty products and materials, like plastics.
Despite the eventual breakup, the deal would undergo rigorous antitrust scrutiny for all three companies, particularly the agricultural chemicals company. Still, the companies did not expect that the deal would require much in the way of other divestitures to satisfy regulators’ concerns.
So, they plan to combine two competing companies into one and then divide into three non-competing companies and they expect this to satisfy regulators? Are the regulators that corrupt?
"Despite the eventual breakup, the deal would undergo rigorous antitrust scrutiny..."
Are the regulators that corrupt?
Regulators don't exist to prevent companies from getting big, they exist to prevent companies from anti-competitive practices. That is very much up to general market conditions, market power and the actions of a company. All of this is helped by the fact that their competitor after the merger-split will still be larger than they are.
So while yes, regulators are likely corrupt just like a politician is likely lying somewhere in the world right now, it doesn't actually have much to do with the situation at hand.
and even better stock options.
Think about how much value this will destroy. A ridiculous of money will go to the lawyers in the process, while a LOT of people will completely reorganize. Ultimately mergers almost always destroy value because of the transaction cost. For something this complex, that seems extremely likely. There will be some production benefits, but also some serious anticompetitive effects.
raise your hand if you read the headline as plan huge merger followed by a spill.
and they will say we need more HB1's as we can't find some in the usa to work our help desk for $12 HR.
It's H1B, not HB1, ya drunk.
The standard model does predict that a Dow/Dupont merged particle could exist, but it would have a very short half life, and will be observed by the three predicted decay companies.
Are the regulators that corrupt?
Absolutely. I expect this to sail through unless it rustles the jimmies of some other large corporation.
China, and the Arab nations, are in the process of building up their chemical industries. So, the two big american chemical companies will merge to keep up.
You know, they could hire some H1B1's to replace the expensive CEOs that are getting $70 million golden parachutes. I bet an Indian CEO would do just as good if not better and do it all for a $70,000 golden parachute.
To me it sounds like there is some hostile activity happening to at least one of the two. So they are going into survival mode. Watch as the axe starts to fall on North American wages and salaries. Watch like a hawk for equipment and whole factories secretly being loaded on ships to go to places where environmental law is non existent and labour is dirt cheap. Trust, integrity, company values have all become smoke and mirrors in our new Warlmart Nation world!
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Ultimately, what is a lobbying group but institutional level major bribes being paid to get something in return?
A lobbying group is an organization for bringing the opinions and interests of their clients to the attention of the legislators. It's a set of specialists who do the constitutionally guaranteed "right to petition the government for redress of grievances" for their clients - professionally as members of an organization of interested parties, or both.
Of course if the legislators are corrupt, lobbyists for small-but-rich interests may resort to bribes. But lobbyists for very large groups don't need to do that. They can offer, instead, more votes from the people whose interests the legislator is supporting - or at least not opposing. These are votes that the members will chose to give voluntarily. (Perhaps after being informed, in turn, that the congresscritter is now working more in line with their interests. Such "being informed" might take the form of the lobbying organization giving them a "good grade" on ratings they publish periodically.)
The two largest organized interest groups, in order, are:
- AARP (over 37 million members)
- NRA (about 5 to 6 million members, whose members' lobbying is done by the non-tax-deductable NRA-ILA organization)
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So do you have a solution for the problems that will precipitate from this mixture? Or just a reaction? Perhaps you are just afraid that when these major elements of the chemical industry are compounded, that it will catalyze a reduction of competition?
Don't waste your vote! Vote for whoever you want, unless you live in a swing state it won't matter anyways
catalyze a reduction of competition?
Not so, the CEOs were talking about oxidizing the competition to the ground
This thinking is just over the line of what a lot of /.ers complaining about business think about. What matters (primarily at least) is competition within the respective industries.
Except that the plan is very similar to that of gerrymandering and telecom companies' regional "gentleman's agreements". Before the merger, there are two companies whose products overlap and therefore are currently in competition. After the merger there will be three companies whose products don't overlap, reducing competition in each of their product areas.
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It's also very similar to splitting up businesses much smaller than the current merger. You need a better argument here.
My view is that huge businesses are directly a result of onerous regulation. The largest businesses have the economies of scale to deal with the overhead of regulation and the resulting corruption of regulators.
Want a competitive marketplace? Make it possible for small and medium scale businesses to thrive.
The Cause For all Modern Day Cancers
Not true! Liberal Luddite Lies! Many modern day cancers are due to power companies, either dirty old coal, or leaky nukes!
Star Trek transporters are just 3d printers.
It's H1B, not HB1, ya drunk.
Maybe it's the pencils. We don't see many HB1s. Mostly HB2s.
Star Trek transporters are just 3d printers.