Bloomberg reports, “Dow Chemical said its partner in a 71-year-old silicone venture that’s on pace for $6 billion of annual sales wants to sell its half of the business, and Dow could be the buyer. Corning Inc. has “more priorities” than the Dow Corning partnership since it bought Samsung Electronics Co.’s stake in a separate venture, Dow Chemical CEO Andrew Liveris said in a presentation to investors.
“We are both very anxious to find the best owner mindset there, without hurting Dow Corning,” Liveris said. “And who the best owner is, I’ll let you reach your own conjecture. I don’t want to create a headline out of this answer, but I do want to say it is part of the conversation.” Daniel F. Collins, a Corning spokesman, said the company is “happy with our ownership stake” in the venture.
Rachelle Schikorra, a spokeswoman for Dow Chemical, said Liveris “didn’t say anything definitive” about buying the partner’s stake. John Roberts, an analyst at UBS Securities who attended the investor meeting, said in a note that he believes Dow is trying to buy Dow Corning. Dow Corning, established in 1943, produces silicones used in sealants, cosmetics and tires. The joint venture, based in Midland, Michigan like Dow Chemical, posted $476 million of net income on $4.54 billion of sales in the nine months through September.
Liveris in under pressure from Third Point LLC, the activist investor founded by Daniel Loeb, to improve returns at the largest US chemical maker by revenue. Liveris yesterday announced plans to reduce its stake in two Kuwaiti ventures as part of a plan to divest as much as $8.5 billion of assets. Corning in January closed on its deal to buy Samsung’s 43% stake in Samsung Corning Precision Materials for $2.2 billion, according to data compiled by Bloomberg.