Dow Chemical says it will likely retain its leading linear-low density polyethylene (LLDPE) franchise in any future deals involving its plastics business. A planned sale of a 50% stake of Dow’s basic plastics business collapsed in late 2008 when Kuwait’s Petrochemicals Industries Co. (PIC) pulled out of a planned joint venture. Dow officials are no longer seeking to find a replacement partner for Kuwait in that venture. “You should expect us to transact differently,” Dow Chemical chairman and CEO Andrew Liveris told reporters at a press conference in Midland, MI Monday. Dow will still seek joint ventures or divestitures for commodity portions of the plastics business, mainly high-density PE (HDPE) and polypropylene (PP), but will seek to keep and grow “higher-value add polyolefins” such as linear low density (LLDPE) where it has the leading global market share. “Technology differentiation and marketing-powered innovation are rewarded [in LLDPE] and we have continued to strengthen this franchise,” Liveris says. The company had the opportunity to complete a plastics deal in first- half 2010 but pulled back after failing to achieve an attractive valuation, Liveris says. “We resisted exiting at a low multiple,” he adds. Liveris said that a plastics deal was not imminent but could occur in the next 12-24 months.
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