Delaware Keeps 2 out of 3 Corporate Headquarters from the Dow-DuPont Merger

As the saying goes, two out of three ‘aint bad!

I’m talking about the announcement today from DuPont and The Dow Company that following the planned separation of DowDuPont, that three independent, publicly traded companies will emerge- with two of them to be based in Wilmington, Delaware.

As part of the agreement, Delaware Governor Jack Markell has committed to work to pass reforms to Delaware’s tax code. These reforms will include a modification of the state’s research and development tax credit to lift yearly expenditure caps and make the credit refundable, as well as the reintroduction of a modernized version of Delaware’s “New Economy Jobs Tax Credit,” intended to attract corporate headquarters jobs to Delaware. The credit provides a value calculated against a portion of the total payroll of a company that contributes high paying jobs to the Delaware economy. Neither of these changes would impact budget projections for FY 2017.

It seems as though key players in Delaware’s legislature are on board with these reforms as well.

Big news, and a win for both the people and the State of Delaware!

Here’s a rundown on the three new companies:

Agriculture Company: A leading global pure‐play Agriculture company that unites the Seeds and Crop Protection businesses from DuPont and Dow. The combined entity is expected to have the most comprehensive and diverse portfolio in the industry and a robust pipeline with exceptional growth opportunities in the near‐, mid‐ and long‐term. The complementary offerings will provide growers across geographies with a broad portfolio of solutions and greater choice. The Agriculture company will be headquartered in Wilmington, Delaware. In addition, the independent Agriculture company will feature DuPont in the company’s name.

Specialty Products Company: A leading global specialty business focused on attractive secular growth markets where innovative science capabilities offer a clear competitive advantage. The company is expected to be composed of four strong businesses which include DuPont’s Nutrition & Health, Industrial Biosciences, and Protective Solutions businesses as well as the integration of DuPont’s Electronics & Communications business with Dow’s Electronic Materials business unit. The Specialty Products company will be headquartered in Wilmington, Delaware.

Material Science Company: A pure‐play industrial leader, consisting of Dow’s Performance Plastics, Performance Materials and Chemicals, Infrastructure Solutions, Consumer Care and Automotive Solutions (excluding the Dow Electronic Materials business) operating segments, as well as DuPont’s Performance Materials segment. The combination of complementary capabilities is expected to create a low‐cost, innovation‐driven leader that can provide customers in high‐growth, high-value industry segments in packaging, transportation, and infrastructure solutions, among others, with a broad and deep portfolio of cost‐effective offerings. The Material Science company will be headquartered in Midland, Michigan. In addition, the independent Material Science company will feature Dow in the company’s name.

Prior to the intended separation into three independent companies, DowDuPont will be dual headquartered in Wilmington, Delaware and Midland, Michigan.

Both parties continue to plan for the closing of the transaction during the second half of 2016, subject to satisfying the necessary closing conditions including obtaining the required pre-merger regulatory approvals.

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