Dow Chemical, DuPont reach deal on merger

Dow Chemical and DuPont agreed to combine their operations into one company that will subsequently split into three, marking one of the largest mergers in the history of business.

With collective market capitalization of $130 billion, the combined company would be known as DowDuPont, the companies said Friday in a statement.

After completing the deal, they said they would pursue a split into three companies — one focused on agriculture, one on material science and one on specialty products. They estimated it would take up to two years to complete the split.

Until then, shareholders of each company will hold 50 percent of the combined giant.

Dow Chemical CEO Andrew Liveris will become executive chairman of the new entity, while DuPont CEO Edward Preen will become chair and CEO.

The merger of equals is still subject to regulatory approval across the globe. U.S. regulators have pumped the brakes on several major deals in recent months, including the Staples-Office Depot accord.

But the decision to immediately break up into three companies could assuage regulators. The companies expect to close the deal in the second half of 2016.

The agriculture company would have combined revenue of $19 billion, the material science company $51 billion and the specialty products company $13 billion.

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