Rohm and Haas has filed a lawsuit against Dow Chemical for Dow’s failing to consummate a $18.8 billion takeover. Philadelphia-based Rohm and Haas claims that Dow Chemical had backed out of its takeover plan, despite obtaining all required approvals. In July, Dow said that it would buy Rohm and Haas for $78 a share to expand its relatively high-margin specialty-chemicals business and expand its global footprint. Dow had agreed to absorb $3.5 billion of Rohm & Haas’s debt as a part of the deal.
Dow was required to close the deal within two business days of the final regulatory approval, which occurred on January 23, 2009. Prior to the approval, Dow could have paid a $750 million break-up to get out of the deal, but that no longer remains an option. Rohm and Haas’ lawsuit is an effort to force Dow into closing the deal. The arrangement started to fall apart in December when Dow’s joint venture with the Kuwaiti government went bad.
The Kuwait deal was meant to finance part of the acquisition of Rohm and Haas. The Kuwaiti government decided to cancel the $17.4 billion agreement with Dow to create the world’s largest maker of polyethylene, a commodity used in consumer products. The government said the venture became too risky and backed out of the deal.
Contact us today for a free legal consultation with an experienced attorney.
Fields marked *may be required for submission.
If you would like to subscribe to the Jere Beasley Report digital edition, simply visit our Subscriptions page and provide the necessary information or call us at 800-898-2034.
Attorney Advertising - Prior results do not guarantee a similar outcome.