The deal combined with company’s other divestitures would give Dow around $7 billion.
The merger involves Dow’s U.S. Gulf Coast chlor-alkali and vinyl, global chlorinated organics’ and epoxy businesses and expected to have revenue around $7 billion.
Dow will receive around $2 billion in cash and $2.2 billion in Olin Stock and the remaining 800 million in the assumptions of Dow’s pensions and other liabilities.
Olin will save at least $200 million a year as a result of increased scale.
After the merger Dow shareholders will hold about 50.5% of Olin’s share and while Olin will hold 49.5% of its shares.
Dow chemical has made this step due to the pressure from activist investor Daniel Loeb.
Dow shares surges over 3% after the announcement is made; now the market value of the company is almost $2 billion.
Olin shares also climbed by 20%, now the company’s worth is around $400 million.