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The gauntlet is thrown

March 22, 2016

The Dow-DuPont transaction is an activist-driven response to demands to create more value for shareholders. The merger creates an industrial behemoth with over USD 120 billion in market capitalization and over USD 80 billion in combined revenue, that is expected to be broken up into three independent, publicly-traded companies focused on Agriculture, Material Sciences and Specialty Products.Roland Berger's analysis of the deal provides insights to chemical companies pursuing their own transformations as well as industry deal makers seeking opportunities.

Roland Berger sees two areas of impact on the broader chemicals industry. Firstly, Dow-DuPont divestitures should create opportunities for traditional chemical companies, as well as private equity firms, seeking acquisitive growth. Secondly, the deal's warm reception by financial markets demonstrates continued investor support for clearer, more focused portfolios - this may embolden activist investors to push diversified chemicals players to accelerate their portfolio transformations via large M&A. It appears that other companies are already acting in this direction based on the recent rumors about BASF making a counterbid for Dow and ChemChina's interest in Syngenta.

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Think:Act

The gauntlet is thrown

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The Dow-DuPont transaction is an activist-driven response to demands to create more value for shareholders.

Published March 2016. Available in
Portrait of Robert Henske
Senior Partner, Managing Partner USA
Boston Office, North America
+1 617 310-6600