MIDLAND — Dow Chemical Co. (NYSE: DOW) has completed the
transaction to restructure the ownership of Dow Corning Corp.
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 earnings before interest, taxes, depreciation and amortization for Dow after cost-cutting measures are taken.
“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 CEO. “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.”
Dow Corning was previously a 73-year 50:50 joint venture between Dow and Corning Inc. 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.
Dow Corning will operate as a wholly owned subsidiary of Dow, and will be headquartered with Dow in Midland.
Dow vice chairman and CFO Howard Ungerleider will serve as chairman of Dow Corning in addition to his current responsibilities. Dow vice president Mauro Gregorio, who leads the Dow Corning integration team for Dow, will serve as CEO of Dow Corning. Andy Tometich, a 27-year Dow Corning veteran, has been business president of the silicones business.
Dow expects the transaction to be accretive to operating earnings per share, cash flow from operations and free cash flow in the first full year after transaction close.