The Dow Chemical Company
's (
DOW
) wholly owned subsidiary, Dow AgroSciences LLC, divested its loss
making European Dithane fungicide business to Indofil Industries
Ltd. of Mumbai, India for an undisclosed amount.
As per the agreement, all the rights and trademarks of Dithane
products in Europe, have been sold to Indofil. However, the
agreement does not include other parts of the Dow AgroSciences'
Dithane business, where it has a competitive advantage.
Indofil, a K.K.Modi group, specializes in Agricultural Chemicals
and Specialty & Performance Chemicals business. The company,
the manufacturer and distributor of Dithane in India for 40 years,
was under Rohm and Haas. This transaction will help Indofil to get
the Dithane product back in its portfolio and grow its presence
across Europe, through active collaboration with all partners.
Earlier in January 2012, one of Dow Chemical Co.'s competitor
Air Products & Chemicals Inc.
(
APD
) announced its plan to divest its Continental Europe Homecare
business to The Linde Groupe of Germany for 590 million euros
(approximately $750 million).
Air Products intends to sell off its Europe Homecare business as
it does not fit with its core gases business. On the contrary, this
acquisition will not only boost Linde's position in the structural
growth market, but will also make it one of the market leaders in
the European respiratory homecare business.
Recently, Dow reported its fourth-quarter 2011 earnings of 25
cents per share, missing the Zacks Consensus Estimate of 32 cents
per share as well as earnings of 47 cents per share in the
prior-year quarter. However, including one-time charges, the
company reported a loss of 2 cents per share compared with earnings
of 37 cents per share in the year-ago quarter.
Though total revenue in the quarter inched up 2% to $14.1
billion, it was below the Zacks Consensus Estimate of $14.4
billion. Sales increased across all operating segments and
geographic areas, except Electronic and Functional Materials.
Volumes declined 3% year over year, but were flat excluding the
impact of divestitures. For full-year 2011, sales increased 12% to
$60 billion.
Dow did not provide any financial guidance. However, the company
anticipates that it will continue facing challenges from Western
Europe in the near term.
DOW faces stiff competition from
EI DuPont de Nemours & Co
. (
DD
).
Currently, DOW has a Zacks #3 Rank, which translates to a
short-term (1 to 3 months) '"Hold' rating. However, we are
maintaining a long- term (more than 6 months) "Neutral"
recommendation on the shares.
AIR PRODS & CHE (
APD
): Free Stock Analysis Report
DU PONT (
EI
) DE (
DD
): Free Stock Analysis Report
DOW CHEMICAL (
DOW
): Free Stock Analysis Report
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