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Dow Restructuring of Dow Corning Corporation


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Building on 73 years of shared history

Dow Completes Strategic Ownership Restructuring of Dow Corning Corporation and Becomes 100 percent owner of Dow Corning’s silicones business

  • Highly synergistic transaction unlocks significant value for Dow shareholders – expected to be accretive to operating EPS, cash flow from operations and free cash flow in the first full year after transaction close
  • Dow targets a minimum of $400 million in annual cost and growth synergies from the restructured ownership; anticipates securing more than $1 billion in additional annual EBITDA at full run-rate synergies
  • Strategic realignment provides powerful new set of material science capabilities, enabling Dow to go narrower and deeper into high-growth, high value market sectors such as building and construction, consumer care, transportation, packaging, electronics, and more

The Dow Chemical Company

(NYSE: DOW) Today announced the successful completion of the transaction to restructure the ownership of Dow Corning.

Dow is now 100 percent owner of Dow Corning’s silicones business, which had 2015 revenues of greater than $4.5 billion and is expected to generate more than $1 billion of annual EBITDA for Dow at full run-rate synergies.

The transaction represents a post-synergy multiple of less than 6x EBITDA, highlighting the unique value creation to Dow shareholders from acquiring 50 percent of the silicones business while benefiting from 100 percent of the synergies.

“Dow Corning’s world-leading silicone position brings a complementary new chemistry and technology to Dow, with it being a hand-in-glove, strategic fit for our material sciences portfolio and based on the additional one billion of EBITDA to Dow’s bottom line at full run rate synergies, which at $400 million is the minimum we expect to achieve, this transaction is highly accretive for our shareholders.

As an owner of Dow Corning for more than seven decades, our deep understanding of common and adjacent markets we serve will enable us to go narrower and deeper into high growth businesses where innovation is rewarded with value,” said Andrew N. Liveris, Dow’s chairman and chief executive officer. “By linking our two robust innovation engines, we will bring greater value to our shareholders and a wider range of differentiated, high value solutions to our customers.”

A pioneer, and current day leader in silicones, silicon-based technology and innovation, Dow Corning was previously a 73-year 50:50 joint venture between Dow and Corning Incorporated. Dow and Corning will maintain their equal proportional equity interests in Hemlock Semiconductor Group, a polysilicon producer in which Dow Corning was the majority shareholder.

The highly synergistic transaction extends Dow’s participation in its Consumer Solutions and Infrastructure Solutions segments, providing immediate integration into Dow’s monomer and polymer value chains.

It also enables Dow to provide complementary technology offerings in attractive industry segments where Dow is already a leader today, such as building and construction, consumer care, transportation, packaging, and electronics. Dow is positioned to capture a minimum of $400 million in annual cost and growth synergies from the restructured ownership.


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