Dow Inc. · NYSE:DOW
Dow — DowDuPont — Merger or Acquisition (December 2015)
21 slides from Dow's merger presentation, Dec 11, 2015
Slide 1: DuPont and Dow to Combine in Merger of Equals
DuPont and Dow to Combine in Merger of Equals Will Create Highly Focused Leading Businesses in Agriculture, Material Science and Specialty Products December 11, 2015
Slide 2: Regulation G and Cautionary Notes on Forward Looking Statements
Regulation G The attached charts include information that does not conform to generally accepted accounting principles (GAAP). Management of the companies believe that an analysis of this data is meaningful to investors because it provides insight with respect to comparisons of the ongoing operating
Slide 3: Important Information About the Transaction and Where to Find It
Important Information About the Transaction and Where to Find It In connection with the proposed transaction, Dow and DuPont will cause DowDuPont to file with the Securities and Exchange Commission (“SEC”) a registration statement on Form S-4 that will include a joint proxy statement of Dow and DuPo
Slide 4: A Combination Unlocking Exceptional Value Across Three Leading Businesses
A Combination Unlocking Exceptional Value Across Three Leading Businesses DowDuPont Agriculture Material Science Specialty Products Revenue: ~$19B1 Revenue: ~$51B1 Revenue: ~$13B1 • Highly-synergistic merger of equals projected2 to unlock ~$30 billion of market value • Intent to pursue tax-free3 sep
Slide 5: Creates Global Leaders Based on Strong Industrial Logic
Creates Global Leaders Based on Strong Industrial Logic Agriculture Material Science Specialty Products Revenue: ~$19B1 Revenue: ~$51B1 Revenue: ~$13B1 ~$11B ~$7B ~$45B ~$6B ~$11B ~$2B Electronics & Consumer Solutions: Agriculture Agricultural Sciences Performance Plastics Performance Materials Comm
Slide 6: Transaction Overview
Transaction Overview • All-stock merger of equals transaction • Combined company will be named DowDuPont Transaction • Combined market capitalization of approximately $130 billion at announcement Structure • Anticipated separation into three independent, publicly traded companies expected to occur a
Slide 7: Total Cost Synergies of ~$3 Billion
Total Cost Synergies of ~$3 Billion Total DowDuPont Synergies Cost Synergies by Business Total Cost Synergies ~$3B ~$3B ~$0.3B Total Growth Synergies ~$1B Specialty Products ~$1.5B Material Science Total Synergies ~$4B Agriculture ~$1.3B Costs to Achieve1 $3.5B - $4.1B Cost Synergies by Function ~$3
Slide 8: Significant Cost Synergy Opportunities
Significant Cost Synergy Opportunities Agriculture Material Science Specialty Products • Drive seed production and • Leverage R&D spend • Optimize global footprint go-to-market cost (programs, resources, across manufacturing, efficiencies sites) in the electronics sales and R&D facilities • Eliminat
Slide 9: Creates Leading Global Agriculture Company
Creates Leading Global Agriculture Company • World’s leading production agriculture business with most comprehensive and diverse seed and crop protection portfolio with exceptional opportunity for growth • Rich history and sustainable commitment to production agriculture • Robust innovation pipeline
Slide 10: Complementary Strengths Across Product Offerings
Complementary Strengths Across Product Offerings Combines Portfolios of Leading Products… …With Strong Capabilities Driving Future Growth Emerging Emerging Seed Brands Traits Germplasm Germplasm Traits Traits Insecticides Insecticides Herbicides Herbicides Fungicides Fungicides Tech Tech Germplasm /
Slide 11: Creates A Leading Global Material Science Company
Creates A Leading Global Material Science Company • Fulfills Dow’s long-term vision of becoming a fully integrated pure play materials company • Leader in materials with competitive offerings for customers in high-growth, high-value sectors • Leading solutions provider to key industries through expa
Slide 12: Integration and Innovation with Low-Cost Position
Integration and Innovation with Low-Cost Position Underpinned by Operational and Commercial Excellence Low Cost Monomers Science & Engineering Key End Markets High-Throughput Packaging Research Ethylene Catalyst Discovery Transportation & Ligand Synthesis Polymer Science Construction Building Blocks
Slide 13: Material Science: Packaging and Transportation Examples
Material Science: Packaging and Transportation Examples Five-layer Plastic Food Package – Packaging Example Multi-layer Films Key Takeaways Example packaging layers 160 • Film and sheet represent majority of PE and EVA market 140 Inner Layer LLDPE • Multilayer films are very popular in food and beve
Slide 14: Creates Leading Specialty Products Company
Creates Leading Specialty Products Company • Unique businesses that share similar investment characteristics and focus in specialty products • Core strengths in technology development and innovation: Clear capital allocation focus • “Asset lite/high touch”: Value added businesses driven by secular t
Slide 15: A New Global Electronics Products Leader
A New Global Electronics Products Leader Combination of DuPont’s Electronics & Communications and Dow Electronic Materials creates the technology leader across four high growth segments: semiconductor materials, advanced packaging, solar-photovoltaic materials and display materials Key Areas of Comp
Slide 16: DowDuPont Financial Profile
DowDuPont Financial Profile 1 2 DowDuPont Revenue ~$54B ~$28B ~$83B Operating ~$9B ~$6B ~$15B EBITDA Operating EBITDA ~17% ~21% ~18% margin % 45% of 25-45% of Cash Consistent with Current Dividend Policy Net Income from Operations Policies at Both Companies Targeting an Investment Credit Rating3 BBB
Slide 17: Governance Highlights
Governance Highlights Merged Entity • Andrew N. Liveris to be named Executive Chairman with focus on Material Science • Edward D. Breen to be named President and CEO with focus on Agriculture and Specialty Products • Breen and CFO are collectively responsible for DowDuPont’s financial oversight • Co
Slide 18: Transaction Creates Global Leaders in Agriculture, Material Science and Specialty Products
Transaction Creates Global Leaders in Agriculture, Material Science And Specialty Products • Strong Industrial Logic: Highly complementary companies create strong, focused businesses with enhanced scale, unique growth strategies and differentiated technologies • Financially Compelling: MOE unlocks s
Slide 19: Appendix
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Slide 20: DuPont Non-GAAP Reconciliations
DuPont Non-GAAP Reconciliations RECONCILIATIONS OF ADJUSTED EBITDA TO CONSOLIDATED INCOME STATEMENTS (dollars in millions, except per share) 2014 Income from continuing operations before income taxes $ 4,313 Add: Significant items (benefit) charge before income taxes(1) (209) Add: Non-operating pens
Slide 21: Dow Non-GAAP Reconciliations
Dow Non-GAAP Reconciliations RECONCILIATIONS OF ADJUSTED EBITDA (dollars in millions, except per share) EBITDA Reconciliation 2014 Net Income Attributable to The Dow Chemical Company $ 3,772 + Net Income Attributable to Noncontrolling Interests 67 + Provision for Income Taxes 1,426 Income Before Inc