UPDATED — The 70 workers at Dow Chemical Co.'s polyolefin films plant in Findlay, Ohio, have received an early Christmas present — the plant will remain open under new ownership rather than close as previously announced.
Midland, Mich.-based Dow will sell the plant — which makes a wide variety of polyolefin films — to Valfilm North America Inc.
Valfilm is a unit of Brazilian plastics packaging firm Valgroup Packaging Solutions.
Dow will close the Findlay plant in late January. Valfilm will re-start the plant sometime in February. The sale is dependent on the state of Ohio approving incentives for the plant.
The sale, plus the separate sale of Dow's sodium borohydride unit, will net Dow $225 million. A separate selling price for the Findlay plant was unavailable. Both transactions are part of Dow's ongoing drive to generate at least $7 billion by selling off businesses by mid-2016.
“We continue to demonstrate our market-driven focus by selectively shifting our portfolio away from businesses that — while valuable — are no longer a strategic fit,” Chairman and CEO Andrew Liveris said in a Dec. 5 news release. “By narrowing our market participation and preferentially funding those businesses in which we have strong competitive positions in attractive markets, we continue to increase value that can be redirected for more strategic uses.”
For Dow — a global plastics and chemicals leader — 2014 has been a tumultuous year. The firm has spent most of the year battling with activist investor Third Point LLC, which had criticized Dow for alleged financial underperformance and called for the firm to be split into two separate companies.
In November, Dow agreed to add four new Third Point-supported directors in exchange for that firm ending its activist campaign for a year. Dow already has sold off $1.3 billion in businesses since 2013, and currently is seeking buyers for its epoxy resin and chlorine-based businesses.
Dow also is reducing its ownership in the Kuwait-based Equate and MEGlobal joint ventures. Equate's products include PE and ethylene; while both Equate and MEGlobal make PET resin feedstock ethylene glycol. In addition, Dow is adding $5 billion to its share repurchase program, bringing the total size of the program to $9.5 billion.
Dow's total sales grew almost 3 percent to $43.8 billion in the first nine months of 2014, but the firm's profit fell more than 20 percent to $3 billion. Sales in Dow's performance plastics unit — including PE and elastomers — grew almost 5 percent to $11.3 billion, while sales in its performance materials unit — including polyurethane and epoxies — grew 3 percent to $10.3 billion.
On Wall Street, Dow's per-share stock price began the year around $44.50 and had climbed near $55 in early September before a broad market sell-off. The price was near $48.20 in early trading Dec. 8.
