DowDuPont says its planned materials science spin-off–the future Dow Chemical–will occur by the end of the first quarter of 2019, with specialty products and agriculture to separate into two different companies by 1 June 2019.
DowDuPont had expected the spin-offs to occur within 24 months of close of the merger, which was on 1 September 2017. The accelerated timeline is “based on the progress we’ve made” getting the organizations in place and identifying possibilities for cost-cutting and synergies, according to DowDuPont CEO Edward Breen.
The company expects to identify assets and liabilities for the three spin-off entities during the first half of this year. Initial SEC filings are expected in second half of the year, with equity road-shows to follow during the first quarter of 2019. Full management teams for materials science, specialty products, and agriculture will also be identified during that time. DowDuPont will also be working to set up legal entities and corporate functions for the new companies over the next year.
Meanwhile, the company is raising its target for total cost cuts to $3.3 billion, from $3 billion. Some $800 million/year in cost cuts have been identified thus far, a larger figure than initially forecast, according to Breen. These higher savings figures are largely due to work on procurement activities, and further savings are possible, Breen says. The focus is now moving to growth synergies, and the company expects to release more specifics on those in upcoming the coming quarters, he adds.
By Vincent Valk
Source: Chemical Week
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