US chemical deal gets go ahead signal
Dow Chemical, the American chemicals group, yesterday said it had received official approval from the US Federal Trade Commission (FTC) for its $1.68bn (£1.05bn) sale of its Morton Salt unit to Germany’s K+S to go ahead, clearing the way for the deal to reach completion stage.
The companies expect the transaction to close within the next few days, following FTC acceptance of a consent decree agreed to by K+S, which will become the largest salt producer in the world as a result of the deal.
Dow said it will use the $1.68bn in gross proceeds from the sale of Morton Salt to fully pay off the balance of a bridge loan it used to partially fund its acquisition of Rohm and Haas earlier this year.
The payoff of the short-term financing facility is ahead of Dow’s original goal of the end of the year, it said.
In a joint statement, the companies said K+S fulfilled the requirements by the FTC for selling bulk de-icing salt assets in Maine and Connecticut.
The deal was a part of Dow’s $15bn acquisition of Rohm and Haas in April. Dow immediately arranged to sell off Morton Salt, which was founded in 1848, as part of a plan to scale back debt stemming from the merger.
Dow Chemical’s shares surged last week after the stock was upgraded by one US analyst who said its reorganisation remained on track