Dow Chemical To Optimize Its Ownership In Kuwaiti JV; Hikes Dividend

(RTTNews) - Dow Chemical Co. (DOW) announced that it intends to restructure its participation in its group of Kuwaiti Joint Ventures with the objective of optimizing its investment and expanding its relationship with Greater EQUATE on the U.S. Gulf Coast. This announcement aligns with Dow's prior stated commitments to optimize its investments in certain joint ventures.

The optimization is expected to occur in two phases. Under the first phase, EQUATE would acquire MEGlobal for a total equity consideration of $3.2 billion. The transaction will result in Dow receiving $1.5 billion in pre-tax proceeds. Following completion of this acquisition, which is expected to close by year-end 2015, Dow will retain a 42.5 percent ownership stake in MEGlobal through its ownership of Greater EQUATE. This acquisition is also expected to drive efficiencies and cost savings due to existing synergies between MEGlobal and EQUATE.

In the second phase, Dow and PIC have agreed that Dow will further reduce its overall ownership interest in Greater EQUATE. The target to complete this second phase of the transaction is mid-2016.

Dow confirms its ongoing portfolio actions will be centered on Dow AgroSciences. The Company will review all options with a best-owner mindset, with a focus on creating new synergies in a consolidating agricultural market.

Dow announced that its Board has declared a 10 percent increase in the Company's dividend, from $0.42 per share to $0.46 per share in the fourth quarter.

The dividend will be payable on January 29, 2016 to shareholders of record on December 31, 2015.

Additionally, the Company today announced that it expects to accelerate its three-year, $5 billion share buyback tranche - repurchasing $1 billion of shares in the fourth quarter, and the remaining $2 billion in 2016. Once completed, Dow will have executed $9.5 billion in share repurchases since 2013.

James Fitterling has been appointed Vice Chairman and Chief Operating Officer. In this capacity, he will have accountability for all of Dow's businesses except Dow AgroSciences, Operations including Environment, Health & Safety and Sustainability, Manufacturing and Engineering, and Supply Chain, as well as Research & Development.

Howard I. Ungerleider has added the position of Vice Chairman to his existing role as Chief Financial Officer. He will also assume responsibility for leading Dow AgroSciences. Dow's Corporate Strategy Development, Corporate Planning, Finance, Information Technology & Business Services functions will also now report to Ungerleider.

Fitterling and Ungerleider will report to Dow Chairman and CEO Andrew N. Liveris and together form a new Office of the Chairman and CEO. Torsten Kraef, Corporate Vice President of Strategy Development, will serve as secretary to the newly announced office.