Midland-based Dow Chemical Co. today announced an agreement to sell its global Ethylene Acrylic Acid (EAA) copolymers and ionomers business to SK Global Chemical Co., a subsidiary of SK Innovation, as part of an ongoing regulatory approval process toward the proposed Dow and DuPont merger transaction.
The divestiture will be conditioned on Dow and DuPont closing their merger transaction, as well as other closing conditions including regulatory findings, local employment law, and governance obligations.
Dow is a leading producer of EAA copolymers, which it markets under the PRIMACOR brand as part of their Packaging and Specialty Plastics business. The divestiture agreement includes production assets located in Freeport, Texas and Tarragona, Spain, as well as associated intellectual property and product trademarks.
“Today’s divestiture announcement marks significant progress in our discussions with the competition authorities,” says Andrew Liveris, Dow’s chairman and CEO. “We continue to work constructively with all of the relevant competition and regulatory authorities around the globe to address their questions and to obtain clearance for the proposed merger.”
Per the terms of the purchase agreement, SK Global Chemical will honor certain customer and supplier contracts and other agreements. Both companies are working together for a seamless transition for all stakeholders.
Given current regulatory agency status, merger closing for the proposed Dow and DuPont transaction are expected to occur in the first half of 2017, subject to satisfaction of customary closing conditions, including receipt of all regulatory approvals. Dow and DuPont expect the intended business separation transactions to be completed about 18 months after the merger close.