Skip to main content
Sister Publication Links
  • European Rubber Journal
  • Plastics News
  • Tire Business
Subscribe
  • Login
  • Register
  • Subscribe
  • News
    • Automotive
    • Tire
    • Non-Tire
    • Suppliers
    • Silicone
    • Online Exclusive
    • Latex
    • Technical Notebooks
    • Executive Action
    • Government/Legal
    • Opinion
    • Rubber Division IEC
    • ITEC
    • Blogs
    • Sustainability
    • Products
    • Wacky World of Rubber
  • War in Ukraine
  • Custom
    • Sponsored Content
    • White Papers
  • Resources
    • Directory
    • Classifieds & Mold Mart
  • Data
  • Events
    • RN Events
    • RN Livestreams/Webinars
    • Industry Events
    • Past Events
    • Rubber News M&A Live
    • 2022 Hose & Belt Manufacturers Conference
    • 2022 International Silicone Conference
    • 2022 International Tire Exhibition & Conference (ITEC)
  • Advertise
  • DIGITAL EDITION
MENU
Breadcrumb
  1. Home
  2. News
February 03, 2016 01:00 AM

Dow CEO to step down after DuPont merger

Jack Kaskey
Bloomberg News
  • Tweet
  • Share
  • Share
  • Email
  • More
    Print
    Dow Chemical CEO Andrew Liveris

    MIDLAND, Mich.—Andrew Liveris, Dow Chemical Co. CEO, will leave the company after the completion of its merger with DuPont Co., marking a victory for activist investor Dan Loeb, who had called for his removal.

    Dow also appointed James Fitterling as president and chief operating officer. The 32-year Dow veteran previously had been vice chairman and COO.

    At 61-years-old, Liveris is a Dow lifer. The executive has spent four decades at the U.S. company. The Australian-born CEO will depart once the newly created DowDuPont is ready for a planned three-way split, no later than the second quarter of 2017, he said during Dow's fourth quarter earnings call on Feb. 2.

    Dow and DuPont announced Dec. 11 a merger of equals, to be followed by the separation of a trio of businesses focused on plastics, agricultural products and specialty materials. The next day, Loeb, the founder of hedge fund Third Point, wrote to Dow's board expressing his support for the deal.

    But he also questioned the timing of its announcement just two days before the expiration of a standstill agreement between Dow and the hedge fund, a person familiar with the matter said at the time. Loeb told the board that he didn't want Liveris involved in the merged company.

    “I totally see how the presence of a major, heavy-hitting activist could play a role, but at the same time this is a logical time for him to pass the baton,” said Matt Arnold, a St. Louis-based analyst at Edward Jones & Co. “This is a chance to go out with the ability to take credit for value creation and setting up the next chapter. All CEOs want to go out at a high point in a company's history.”

    The merger with DuPont would be the largest ever in the chemical industry. The companies have a combined market capitalization exceeding $99 billion, based on current trading. The deal is scheduled to close by the end of this year, Liveris said on the earnings call.

    The transaction was made possible because another activist investor, Nelson Peltz, co-founder of Trian Fund Management, shook things up at DuPont. Peltz took advantage of weaker-than-expected earnings following his failed proxy campaign for DuPont board seats, putting pressure on CEO Ellen Kullman to depart. Ed Breen replaced Kullman on a permanent basis in November and agreed to the Dow merger the following month.

    Loeb has been a thorn in the side of Liveris and Midland-based Dow since January 2014, when Third Point began criticizing the company's performance and advocated for its breakup. In November that year, Third Point explored a proxy contest and attacked Liveris in a video.

    A week later, Dow agreed to turn over two board seats to nominees of the hedge fund. The two sides also agreed to the standstill arrangement, which barred either one from publicly disparaging the other.

    Liveris has been CEO since 2004. His total compensation was $24.7 million in 2014 and he holds Dow shares with a market value of about $42.6 million, according to data compiled by Bloomberg. Liveris also has a pension worth $33.7 million as of Dec. 31, 2014, according to company filings.

    Liveris spoke with Loeb after the DowDuPont deal was announced, the CEO said in an interview before he disclosed his departure. Asked about Loeb's letter, Liveris said every activist has their business model.

    “They write those things, and then we talk,” he said.

    Third Point has a 2 percent stake in Dow, according to data compiled by Bloomberg. A spokeswoman for Third Point declined to comment on Liveris.

    Dow reported fourth-quarter earnings on Tuesday that beat analysts' estimates as margins expanded. That's the ninth consecutive quarter that the company surpassed profit expectations, according to data compiled by Bloomberg, a period that coincides with Loeb's investment in the company.

    “It's pretty hard to argue with performance,” Liveris said.

    Plastics News, a sister publication of Rubber & Plastics News, contributed to this report.

    Related Articles
    DuPont to cut more than 5,000 from work force
    Merger of equals; Dow, DuPont to divide company into three large businesses
    Dow to become full owner of Dow Corning
    Dow promotes pair
    Dow settles price-fixing case
    Exiting Dow, DuPont execs could net big payday
    DuPont selects president for Performance Materials unit
    DowDuPont clarifies merger timetable
    Dow-DuPont shareholders approve $59 billion merger
    Letter
    to the
    Editor

    Rubber News wants to hear from its readers. If you want to express your opinion on a story or issue, email your letter to Editor Bruce Meyer at [email protected].

    Most Popular
    1
    Wacky World of Rubber: The true story behind the rubber match
    2
    Stakes high as global NR industry urgently seeks alternate supply
    3
    Updated: Conti fined for compound mixer explosion, shears accident
    4
    ExxonMobil to increase olefinic capacity with $2 billion expansion
    5
    Uth: Investment in solar power a reflection of success
    SIGN UP FOR NEWSLETTERS
    EMAIL ADDRESS

    Please enter a valid email address.

    Please enter your email address.

    Please verify captcha.

    Please select at least one newsletter to subscribe.

    Get our newsletters

    Staying current is easy with Rubber News delivered straight to your inbox, free of charge.

    Subscribe Today

    Subscribe to Rubber News to get the best coverage and leading insights in the industry.

    SUBSCRIBE
    Connect with Us
    • LinkedIn
    • Facebook
    • Twitter

    MISSION

    To serve companies in the global rubber product industry by delivering news, industry insights, opinions and technical information.

    Contact Us

    2291 Riverfront Pkwy, Suite 1000
    Cuyahoga Falls,
    OH 44221

    Customer Service:
    877-320-1726

    Resources
    • About Us
    • Digital Edition
    • Staff
    • Advertise
    • Order Reprints
    • Privacy Policy
    • Privacy Request
    • Terms of Service
    • Careers
    • Ad Choices Ad Choices
    • Sitemap
    Partner Sites
    • Tire Business
    • European Rubber Journal
    • Plastics News
    • Plastics News China
    • Urethanes Technology
    • Automotive News
    • Crain Brands
    Copyright © 1996-2022. Crain Communications, Inc. All Rights Reserved.
    • News
      • Automotive
      • Tire
      • Non-Tire
      • Suppliers
      • Silicone
      • Online Exclusive
      • Latex
      • Technical Notebooks
      • Executive Action
      • Government/Legal
      • Opinion
      • Rubber Division IEC
      • ITEC
      • Blogs
        • Products
        • Wacky World of Rubber
      • Sustainability
    • War in Ukraine
    • Custom
      • Sponsored Content
      • White Papers
    • Resources
      • Directory
      • Classifieds & Mold Mart
    • Data
    • Events
      • RN Events
        • 2022 Hose & Belt Manufacturers Conference
        • 2022 International Silicone Conference
        • 2022 International Tire Exhibition & Conference (ITEC)
      • RN Livestreams/Webinars
      • Industry Events
      • Past Events
      • Rubber News M&A Live
    • Advertise
    • DIGITAL EDITION