DowDuPont Alters Split Plans, Shifts $8 Billion in Revenue to Specialty Products
DowDuPont will shift businesses with $8 billion in annual revenue from its planned material science spinoff to the specialty products spinoff as part of a previously announced portfolio review. Businesses moved to specialty products include: Dow automotive systems’ adhesives and fluids platforms; Dow’s building solutions business; Dow’s water and process solutions business; Dow’s pharma and food solutions business; Dow’s microbial control business; DuPont’s performance polymers business; and several Dow silicones-based businesses aligned with applications in industrial LED, semiconductors, medical, as well as Molykote brand lubricants for automotive and industrial equipment and Multibase, which serves the thermoplastic compounding industry. Materials science will have the “vast majority of its sales aligned to three narrower and deeper, high-growth market verticals; packaging, infrastructure and consumer care,” says Andrew Liveris, executive chairman of DowDuPont. The materials business had 2016 net sales of more than $40 billion with higher than 20% operating EBITDA margin. The only part of DuPont that remains with materials now is a portion of DuPont’s performance materials segment, including its Orange, Texas cracker and ethylene copolymers. The shifts will boost specialty products revenue from roughly $13 billion to $21 billion in annual sales with operating EBITDA margins of 25%. The business will be aligned around four market segments: electronics and imaging; transportation and advanced polymers; safety and construction; and nutrition and biosciences. Businesses shifting over include DuPont’s $4-billion performance polymers business, a leading producer of engineering plastics and elastomers, including nylon, acetal and fluoropolymers that had been slated to move to materials. The business also gains Dow’s automotive adhesives and fluids business; building solutions, including Styrofoam insulation and Great Stuff. In silicones, the business adds medical and trichlorosilanes as well as additional electronic materials. Source: IHS Chemical Week, 9/12/2017.