FTC Denies Dow Chemical's Request To Modify 2009 Settlement

  DOW JONES NEWSWIRES 
 

The Federal Trade Commission denied Dow Chemical Co.'s (DOW) request to modify a 2009 settlement that was reached to resolve competitive concerns related to the chemical company's $16 billion acquisition of Rohm & Haas Co.

Shares were down 2.7% at $34.63 in recent trading but are still up 1.5% so far this year.

Dow acquired the specialty-chemicals business in a bid to transform itself away from the highly cyclical commodities chemicals business toward higher-margin specialty products.

The largest U.S. chemical producer had been required to sell a California location that includes a latex polymers plant. However, the FTC said that Dow's application indicated that the FTC-approved buyer, French specialty-chemicals company Arkema SA (ARKEMA, AKE.FR), only agreed to a long-term lease of the plant with an option to buy a portion of the property where it is located.

Dow's efforts to sell the whole site have been unsuccessful and the company had asked the FTC to eliminate the obligation to sell the entire site or to grant a three-year extension. Dow's application also said it had failed to obtain required approvals to subdivide the site to sell a portion to Arkema.

In denying the request, the FTC said competitive risks remain if Dow retains control of the facility and the company failed to show that modifying the settlement would be in the public interest, among other things.

A company spokesperson wasn't immediately available to comment.

Dow in April reported that its first-quarter earnings climbed 34% as it continued to benefit from a broad manufacturing rebound.

-By Tess Stynes, Dow Jones Newswires; 212-416-2481; [e-mail]