Tuesday, December 03, 2013

Dow Chemical to Drop the Chemical, in both Word and Deed

The Urethane Blog is reporting that Dow Chemical is thinking about dropping the "chemical" from it's name. Much as very few people refer to E. I. du Pont de Nemours and Company by it's full name and instead go with "Dupont", very few people also refer to the company as "Dow Chemical". I don't remember the last time that the company's logo even had "chemical" in it. However, it is a handy name to have for Google searches, since if you search just "Dow", you get a mix of sites about the company and also the Dow Jones Industrial Average, which not surprisingly, is also seldom referred to by its full name but simply as "the Dow".

While we can all ask "what's in a name" [*], the bigger picture is that Dow is moving out of the commodity chemical business and has identified a$5 billion slice of their chlorine business that can be carved out of the company. It's not clear if a ready buyer for this exists, if one has to be found or it the business will be spun off on its own.

While it is not surprising that after a merger/acquisition, there are layoffs as a result of duplication of employees, it has also been my experience that spin-offs seem to also result in layoffs. In some cases it is because the CEO of the spin-off company looks at the books differently than the CEO of the spinning-off company, and in other cases it is because the spinning-off company stuck with spin off with excess employees that it want to cut anyway, but didn't want the blood on their hands. But with over 2000 employees being identified as part of this $5 billion carve-out, we can be sure that sadly some people will be cut sooner or later.

[*] To misquote the Bard, "What's in a name? That which we call a chemical plant By any other name would smell as malodorous".

1 comment:

Chemjobber said...

I agree with your assessment, regarding layoffs.