Dow Chemical buys Bayer unit for $725 mln
Mon Jul 2, 2007 3:21pm ET
NEW YORK, July 2 (Reuters) - Dow Chemical Co said on Monday it has bought German chemical maker Bayer AG's Wolff Walsrode cellulosics business for about $725 million, and announced the launch of a new specialty business unit.
The price includes the assumption of debt and pension commitments, the companies said in a joint press release.
The Wolff Walsrode business, which has about 1,600 employees, makes products derived from plant cellulose that are used in the construction, food and pharmaceutical industries.
Dow, the largest U.S. chemical maker, also announced the launch of Dow Wolff Cellulosics, a specialty business unit with over $1 billion in annual sales. The new unit is a combination of the Wolff Walsrode business and Dow's water-soluble polymers business.
Bayer agreed to sell the Wolff Walsrode unit to Dow last year but had not disclosed the value of the deal.
The acquisition, which is expected to add to earnings within a year, is in-line with Midland, Michigan-based Dow's strategy of growing its specialty chemicals business.
"Wolff is a strategically aligned acquisition that brings new expertise and customer focus to accelerate Dow's growth in key specialty markets," Andrew Liveris, chief executive of Dow, said in a statement.
Shares of Dow were up 1.7 percent to $44.98 in afternoon trade on the New York Stock Exchange.
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