Dow Chemical jumps on private equity rumors
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By Laura Mandaro, MarketWatch
Last Update: 4:47 PM ET Jan 19, 2007
SAN FRANCISCO (MarketWatch) -- Dow Chemical Co. shares Friday made their biggest one-day move in 14 months after investors responded to rumors of a bid to break up the chemical giant.
Shares in the world's largest chemicals company jumped as much as 4% to $42.60 before closing 2.8% higher at $42.08, their steepest daily rise since Nov. 2005. More than 14.9 million shares traded hands, or about three times Dow Chemical's
DOW, , ) normal volume.
Chart of DOW
The Financial Times in its Friday edition said there had been talk about a private equity consortium working on a bid to break apart the Midland, Mich.-based company.
"Clearly the stock's reacting to this," said HSBC analyst Hassan Ahmed.
But he said the prospect of a massive asset sale sounded dubious.
Dow Chemical CEO Andrew Liveris, who took his position in 2004 after nearly three decades with the company, is "adamant that his strategy is the right one, that is to grow the specialty business and use the commodity business to feed into the specialties," he said.
The newspaper did not go into further details or cite any sources about a possible break-up bid.
Dow Chemical spokesman Chris Huntley said via e-mail, "it is Dow policy not to comment on rumors or speculation."
For the first nine months of last year, 24% of Dow's sales came from its basic plastics business while 12% came from basic chemicals.
These so-called commodities products, such as polyethylene and polystyrene, are typically more cyclical than fabricated products like latex for paints or foam for car seats.
Analysts expect Dow Chemical and other firms with big positions in commodities chemicals to have a tough fourth-quarter reporting season because prices for many basic chemicals slipped in the final three months of last year. See Earnings Outlook.
Dow Chemical reports its fourth-quarter earnings on Thursday, Jan. 25. Analysts expect fourth quarter earnings to fall to 93 cents a share from $1.02 a share excluding special items in the year-ago quarter, says Thomson Financial. End of Story Gruß
nuessa
www.chartchancen.eu
Disable live quotes
RSS
Digg it
Del.icio.us
By Laura Mandaro, MarketWatch
Last Update: 4:47 PM ET Jan 19, 2007
SAN FRANCISCO (MarketWatch) -- Dow Chemical Co. shares Friday made their biggest one-day move in 14 months after investors responded to rumors of a bid to break up the chemical giant.
Shares in the world's largest chemicals company jumped as much as 4% to $42.60 before closing 2.8% higher at $42.08, their steepest daily rise since Nov. 2005. More than 14.9 million shares traded hands, or about three times Dow Chemical's
DOW, , ) normal volume.
Chart of DOW
The Financial Times in its Friday edition said there had been talk about a private equity consortium working on a bid to break apart the Midland, Mich.-based company.
"Clearly the stock's reacting to this," said HSBC analyst Hassan Ahmed.
But he said the prospect of a massive asset sale sounded dubious.
Dow Chemical CEO Andrew Liveris, who took his position in 2004 after nearly three decades with the company, is "adamant that his strategy is the right one, that is to grow the specialty business and use the commodity business to feed into the specialties," he said.
The newspaper did not go into further details or cite any sources about a possible break-up bid.
Dow Chemical spokesman Chris Huntley said via e-mail, "it is Dow policy not to comment on rumors or speculation."
For the first nine months of last year, 24% of Dow's sales came from its basic plastics business while 12% came from basic chemicals.
These so-called commodities products, such as polyethylene and polystyrene, are typically more cyclical than fabricated products like latex for paints or foam for car seats.
Analysts expect Dow Chemical and other firms with big positions in commodities chemicals to have a tough fourth-quarter reporting season because prices for many basic chemicals slipped in the final three months of last year. See Earnings Outlook.
Dow Chemical reports its fourth-quarter earnings on Thursday, Jan. 25. Analysts expect fourth quarter earnings to fall to 93 cents a share from $1.02 a share excluding special items in the year-ago quarter, says Thomson Financial. End of Story Gruß
nuessa
www.chartchancen.eu
