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Dow Chemical

Dow Chemical (NYSE: DOW) is a diversified chemical company. It is headquartered in Midland, Mich. and was founded in 1897.

website: http://www.dow.com/

Book: “Growth Company: Dow Chemical’s First Century,” by E. N. Brandt, Michigan State University Press, East Lansing, MI, 1997. See the review posted on Motley Fool's Books--Non-fiction discussion board: [1]

Expanded Definition

Dow is a large diversified, global chemical company with numerous plants and product lines. Based on 2014 sales, C&EN ranked Dow Chemical as the largest US chemical firm, and second after BASF globally. Its major business units are--


Consumer and Lifestyle


Infrastructure and Transportation

The company was founded by Herbert Dow to extract bromine from the salt domes of Michigan. That required chlorine to convert natural bromide to volatile bromine. The company was an early user of electrochemical cells to make chlorine from salt. It also sold chlorinated lime (now called calcium hypochlorite) an early disinfectant and the original agent used to chlorinate drinking water. Later chlorinated solvents were developed including chloroform, trichloroethylene, the vapor degreaser for metals, and Permachlor, the non flammable dry cleaning solvent. The company is famous for an integrated system that allows it to recover and recycle byproduct chlorides on its major sites.

Later its business evolved to include plastics like polystyrene.

Dow owns Dow-Corning in a joint venture with Corning Glass Works and through subsidiary Hemlock is a major producer of polysilicon for integrated circuits and photovoltaic solar cells. In 2014, Hemlock announced plans to write off its $1.6B investment in a new polysilicon plant in Clarksville, TN. This resulted in a $500MM writeoff to both Dow Chemical and Corning. The plant is the victim of low cost polysilicon imported from China.

In 2015, Dow contracted to buy 200 MW from Bordas Wind Energy for use at Freeport, TX. The contract will make Dow the third largest corporate purchaser of wind energy.

In 2015, Union Carbide subsidiary of Dow reacquired the Institute, WV plant which made methyl isocyanate. The chemical had killed thousands in Bhopal, India when a tank spewed toxic fumes into the air. Carbide sold the business to Rhone-Poulenc in 1986, which sold it to Bayer in 2002. After an incident in 2008, Bayer discontinued most operations on the site and now sold it back to Union Carbide.

In 2015, Ford Motor formed a jv with DowAksa, a jv between Dow Chemical and Aksa Akrilik of Istanbul to explore further use of carbon fiber composites in vehicles. Carbon fiber offers lighter strength (next after aluminum) but so far is too costly and difficult to process in the volumes needed for automotive applications. [2]

In 2015, Dow Chemical was authorized by the FAA to use drones to inspect plants and equipment in the US. They report use of drones made by Aeryon Labs.


In recent times the company has focused on selling off it low margin commodity businesses and adding specialty chemicals lines through acquisitions. Its major acquisitions include Union Carbide and Rohm & Haas (2009). In 2010, Dow sold its styrenics business to Bain Capital. The styrenics business presumably included styrene monomer, polystyrene, and styrene co-polymers such as ABS. In 2011, the polypropylene business was sold to Braskem.

As a global chemical company Dow has invested in manufacturing plants around the world. That included investments in the mideast to convert abundant hydrocarbons there into marketable chemicals. In 2014, Dow announced the sale of its interest in two Kuwaiti JVs. The businesses made polyester fibers, antifreeze, and plastics. Presumably that means ethylene, ethylene glycol, and polyethylene.

In 2014, Dow announced the sale of its polypropylene catalyst business to WR Grace. Dow also announced plans to divest three more businesses: Angus Chemical Company, (maker of nitromethane, nitroparaffin solvents, AMP amine, Trisamino, and related specialty chemicals), (Angus Chemical was sold to Golden Gate Capital), sodium Borohydride (most often used in synthesis of high value materials like drugs, also as stabilizer for some materials) (sold to Vertellus Specialities), and AgroFresh (according to website technology to extend shelflife of flowers, fruits and vegetables by blocking the ripening caused by natural ethylene).

In 2015, Dow announced the sale of its chlor-alkali business (including vinyl, chlorinated organics and epoxy resins) to Olin for a combination of cash and stock. Olin will become the largest chlor-alkali producer. (OxyChem division of Occidental Petroleum and Axiall are second and third in the business.) Dow shareholders will receive Olin stock, and own 50.5% of Olin, and Dow will have three seats on its board of directors.


As Dow sheds its commodity businesses, agricultural products become more important. For those who supply seeds in the ag sector, corn is king. Wall Street Journal on Feb 26, 2014, gave 2013 market share as Dupont, 35%; Monsanto, 35; AgReliant, 6; Syngenta, 6; Dow, 4; others 14%.

For 2004, Dupont, 33%; Monsanto, 14; Garst, 6; Syngenta, 5; Golden Harvest, 4; Dow, 4; AgReliant, 3; + others.

In 2014, Dow received USDA approval for its Enlist 2,4-D resistant corn and soybeans. Enlist still awaits EPA approval. Enlist is potentially a second generation alternative to Monsanto's market leading Round-up Ready Soybeans, where weeds are becoming increasingly resistant to Round-up.

In 2015, Dow announced plans to consider alternatives for its ag business after missing sales targets. Dupont and Monsanto were mentioned as possible buyers. Or a spin off is possible. Dow also announced plans to buy out Corning's interest in their Dow Corning jv.

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