Dow and Mitsui Form Joint Venture for Chlor-Alkali Production
Agreement Drives Integration Advantage for Downstream Businesses
MIDLAND, Mich.--(BUSINESS WIRE)--The Dow Chemical Company (NYSE: DOW) and Mitsui & Co., Ltd., of Tokyo, Japan (NASDAQ: MITSY) announced today that the two companies have signed a definitive agreement to form a 50:50 manufacturing joint venture to construct, own and operate a new membrane chlor-alkali facility located at Dow’s Freeport, Texas, integrated manufacturing complex.
This landmark joint venture combines the strengths of two global companies to build a world-scale chlor-alkali plant on the U.S. Gulf Coast.
The facility will be built using Dow's modern and efficient chlor-alkali technology, and takes the place of the previously announced Chlorine 7 project, which was a Dow-only venture.
"This joint venture with Mitsui is another meaningful example of our strategy in action - enabling us to continue to supply building blocks to our downstream performance businesses at lower cost and with less capital," said Andrew Liveris, Dow chairman and chief executive officer. "Dow’s Basic Chemicals business is a world-class manufacturing franchise that delivers unique product and technology integration advantage to our downstream performance and market-driven businesses. This strategic joint venture bolsters our integration strength, while also liberating capital for investment in businesses that are technology- and customer-driven with higher, more consistent earnings."
The new chlor-alkali facility is expected to begin operations in mid-2013, and will have a capacity of approximately 800 kilotons per annum. Dow will operate and maintain the chlor-alkali facility under contract to the joint venture. Construction will begin in the fourth quarter of 2010. The venture will create approximately 50 long-term jobs at the Freeport, Texas, location, as well as approximately 500 construction jobs during the build.
The joint venture’s new chlor-alkali production facility will fuel the growing feedstock needs of Dow’s performance businesses with cost-advantaged chlorine supply.
More than 70 percent of Dow’s chlor-alkali production is used to serve its growing performance and market-driven businesses.
Close of the transaction is expected in the third quarter of 2010, depending upon regulatory approvals and customary closing conditions.
About The Dow Chemical Company
Dow combines the power of science and technology with the “Human Element” to passionately innovate what is essential to human progress. The Company connects chemistry and innovation with the principles of sustainability to help address many of the world’s most challenging problems such as the need for clean water, renewable energy generation and conservation, and increasing agricultural productivity. Dow’s diversified industry-leading portfolio of specialty chemical, advanced materials, agrosciences and plastics businesses delivers a broad range of technology-based products and solutions to customers in approximately 160 countries and in high growth sectors such as electronics, water, energy, coatings and agriculture. In 2009, Dow had annual sales of $45 billion and employed approximately 52,000 people worldwide. The Company’s more than 5,000 products are manufactured at 214 sites in 37 countries across the globe. References to "Dow" or the "Company" mean The Dow Chemical Company and its consolidated subsidiaries unless otherwise expressly noted. More information about Dow can be found at www.dow.com.