FTC OKs Dow Chemical’s Purchase of Union Carbide

Federal anti-trust regulators finally approved Dow Chemical’s acquisition of Union Carbide. However, the Federal Trade Commission requires Dow Chemical to sell crucial chemical assets and technology aimed at making better plastic at lower cost. The FTC’s conditions for approving the transaction were in line with similar conditions set by European regulators in May.

“This merger (as originally proposed) would have significantly reduced competition in the development of new consumer plastic products and technology,” said Molly Boast, acting director of the Federal Trade Commission’s Bureau of Competition.

To win FTC approval, Dow agreed to sell and license to BP Amoco technology for making linear-low-density polyethylene. In addition, the combined company must sell smaller chemical businesses where a Dow-Carbide combination created unacceptable market dominance. Dow will sell ethyleneamines, a chemical used in oil additives, epoxy, fungicides and paper-making to Huntsman Chemical. In addition, Dow will sell its methyldiethanolamine or MDEA business to Huntsman. Dow will also sell its ethanolamines unit to Ineos Acrylics UK