The Dow Chemical Co. on Tuesday formally denied a key investor’s request to spin off its petrochemicals unit. Hedge fund manager Daniel S. Loeb in January called for the company to separate the petrochemicals business last month in order to focus more squarely on specialty chemicals. Dow CEO Andrew Liveris later made public statements indicating the company would not pursue a break-up.
Documents filed with the Securities and Exchange Commission on Tuesday brought more clarity to Dow’s position. In its statement, Dow said a recent evaluation found that a separation of its petrochemical and specialty chemicals assets “created no productivity or capital allocation improvements but rather negatively impacted Dow’s value proposition.” Dow recently began an effort to exit the commodity chemicals business. It announced in December it would carve out $5 billion in chlorine value chain assets, including facilities in Freeport, Texas, and Plaquemine, La.
