Dow Chemical Co and DuPont Co announced on 20 July that their shareholders had approved their historic merger, clearing a hurdle for the deal to close in the second half of this year and for a later split into three businesses.
The merger of the two largest US chemical makers into DowDuPont Inc in a US$59bn all-stock transaction was announced on 11 December (see News, OFI January 2016).
Bloomberg said both companies were cutting thousands of jobs as they cut billions of dollars in expenses, with another US$3bn in cost savings promised after the deal closed.
DowDuPont is due to split into three by the end of 2018, creating separate companies focused on agriculture, specialty products and materials science.
Both companies supply GM seeds and crop protection products to the oils and fats industry.
DuPont Pioneer is a subsidiary of DuPont Co and a major producer of hybrid seeds for agriculture including GM crops with insect and herbicide resistance.
Dow AgroSciences is a wholly-owned subsidiary of Dow Chemical Co supplying seeds, biotech solutions and agricultural pesticides.
OFI reported that the biggest impact of the merger would be in the agriculture market, where the seeds and crop chemical industries are undergoing rapid consolidation.
The companies’ next hurdle was winning antitrust clearance, Bloomberg said.
“The US Justice Department in February issued a second request for information on the combination, launching an in-depth probe. Dow and DuPont notified China’s competition agency of the deal in May and they filed with the European Commission last month.”