Dow-DuPont Merger Likely to Face Antitrust Scrutiny Worldwide
- Merger-to-breakup scenario creates challenges for regulators
- Transformative deals often affect competition, experts say
Chemicals Megamerger: The Cost of Creating DowDuPont
While Dow Chemical Co. and DuPont Co. executives appear confident that regulatory tangles aren’t on the horizon for the $120 billion “merger of equals” announced Friday, the deal is likely to face protracted antitrust analysis worldwide, according to Bloomberg Intelligence.
The structure of the deal brings the two biggest American chemical producers together before breaking them up into three businesses: agriculture, specialty chemicals and commodity chemicals. That poses a particular challenge for regulators as the competitive landscape is reshaped, according to Allen Grunes, a former Justice Department antitrust lawyer now with Konkurrenz Group in Washington. An antitrust investigation would focus on individual product lines where the two compete and where there are few other rivals to keep prices in check.