[M.D. Holloway]

Dow Chemical Shares Climb On Report Of Possible $50 Billion Buyout

Manufacturing.Net - April 09, 2007

NEW YORK (AP) - Shares of Dow Chemical Co. rose more than 10 percent Monday after a British newspaper reported a group of Middle Eastern investors and U.S. buyout firms was preparing a bid for the chemicals and plastics maker.

The Sunday Express reported over the weekend that the group has secured financing backing for a $50 billion bid for the Michigan-based chemicals company; making it the biggest leveraged buyout ever.

The reported investment team, which includes private equity firm Kohlberg Kravis Roberts & Co., is preparing a bid of $52 to $58 per share. At the low end, that would be a 17 percent premium over Dow Chemical's closing stock price of $44.47 on Thursday on the New York Stock Exchange. The market was closed on Good Friday.

Dow Chemical's stock jumped $4.53, or 10.2 percent, to $49 in premarket trading Monday.

The newspaper said a bid between $52 to $58 a share could come this week, with half the financial backing coming from investors in Saudi Arabia, Kuwait, Bahrain, Qatar, the United Arab Emirates and Oman, and half from U.S. investors.

The newspaper did not name any other investors other than KKR and did not cite sources.

Dow Chemical makes and sells chemicals, plastics and farm products to customers in a range of industries.